Cotton Yarn Prices At Home And Abroad Have Fallen

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This week (October 26-30, 2020), domestic cotton prices continued to fall, international cotton prices stopped rising and fell; domestic and foreign cotton yarn prices fell one after another; polyester staple fiber prices fell downward.

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Domestic cotton prices continue to be weak

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The picking rate of domestic new cotton is close to 90%, the lint supply is gradually increasing, and the transaction heat of downstream textile market continues to cool down, and the domestic cotton price goes down. From October 26 to 30, 2020, the settlement price of the main contract of Zhengzhou cotton futures was 14518 yuan / ton, down 196 yuan / ton, or 1.3%, compared with the previous week; the average price of national cotton price B index, which represents the market price of standard lint in the mainland, was 14568 yuan / ton, 170 yuan / ton, or 1.2% lower than that of the previous week. China's cotton purchase price s index, which represents the average price of three grade seed cotton converted into lint cotton in China's major cotton producing provinces (regions), averaged 14266 yuan / ton (excluding processing fees), down 640 yuan / ton or 4.5% compared with the previous week.

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International cotton prices stop rising and fall

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With the rapid spread of the epidemic situation in Europe and the United States, France and Germany announced that they would implement national blockade measures. The dollar index rose, the global stock market fell sharply, and the international cotton price fell accordingly. On October 26-30, 2020, the settlement price of the main contract of New York cotton futures was 71.03 cents / pound, down 0.26 cents / pound or 0.4% compared with the previous week; the average international cotton index (m), representing the average CIF price of imported cotton in China's main ports, was 76.57 us cents / pound, down 0.55 cents / pound or 0.7% compared with the previous week. The import cost of RMB 13004 yuan / ton (calculated by 1% tariff, including port miscellaneous and freight) was lower than that of the previous week The price of international cotton was 1564 yuan / ton lower than that of domestic cotton price, and the difference between domestic and foreign prices was reduced by 79 yuan / ton compared with last week.

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Cotton yarn prices at home and abroad have fallen

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After the high price of cotton yarn, the average price of domestic and foreign cotton yarn fell to 8 yuan, and the average price of domestic and foreign cotton yarn continued to decline from the domestic and foreign prices. Lower reaches of Guangdong, Jiangsu, Zhejiang and other places grey cloth orders slightly decreased compared with the previous week, pure cotton prices gradually stopped rising steadily; polyester staple fiber prices fell with crude oil and raw material PTA trend.

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Future prospects

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The European and American epidemic situation has returned, the US presidential election has entered the countdown, and the international cotton market risk has been amplified. US GDP rose 33% in the third quarter, and strong economic data failed to stop the stock market from rising and falling. With the resurgence of the new crown epidemic, the risk of the European and American economy falling into the second recession is increasing. Under the environment of abundant global capital, the capital market game is fierce and the market volatility is rising.

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In the international cotton market, ice cotton futures prices fell again to less than 70 cents / pound. At present, the growth of new cotton in the United States is slightly improved, and the boll opening progress and the proportion of good cotton increased by 1 percentage point compared with last year; as of October 21, the new cotton market volume in India was 22800 tons, and the cotton association of India (CAI) said that the cotton carried forward inventory of India in 2020 / 21 cotton year reached a record of 1.828 million tons, which would exert pressure on cotton price; new cotton in Australia began to be sown, with continuous rainfall The arrival will help ease the drought.

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After the international cotton yarn price is pushed up, the downstream inquiry and transaction are expected to decrease, and the purchasing heat of foreign cotton by Pakistan textile enterprises will decrease. The surge in the number of new crown infections will increase the risk of US presidential election next week. In the short term, the international cotton market will tend to be cautious, and the fluctuation range will increase in the downward process of cotton price oscillation.

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In the short term, domestic cotton price is mainly weak oscillation, and external turbulence factors increase. According to the data of the National Bureau of statistics, the total profits of Industrial Enterprises above Designated Size in China decreased by 2.4% from January to September, 2% lower than that from January to August. Among them, the textile and clothing industry decreased by 22.9% year-on-year, 2.7% lower than that of January August. In terms of the domestic cotton market, the cotton ginning plant in Northern Xinjiang has entered the stage of centralized processing and sales, with less market transactions; under the normalization of domestic epidemic prevention and control, it is expected that the harvest of new flowers in southern Xinjiang will soon return to normal.

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As of October 30, China's new cotton picking progress was 86.3%, an increase of 0.8% year-on-year. The total sales of seed cotton and lint cotton were 4.498 million tons, with an increase of 189000 tons. With the recent fall of Zhengzhou cotton, the hedging pressure showed signs of increasing. On October 30, the number of Zhengzhou cotton warehouse receipts was 177600 tons, which was the first one-day increase since this year. Due to the spread of "double orders" and "overseas orders" in the late period of the Chinese new year, enterprises will be more cautious in the delivery of orders from overseas. It is expected that the domestic cotton price will maintain a weak oscillation in the short term, and the external turbulence factors such as the overseas epidemic situation and the US election will increase next week, and the cotton price may adjust accordingly.

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