Market Trends: The Basis Difference Of Australian Cotton Is Relatively High, And The Price Of Domestic And Foreign Cotton Increases Rapidly

Cotton in Nantong, Zhangjiagang and other places (14585, - 145.00, -0.98%) trade enterprises feedback that since the middle of July, except for a slight increase in the RMB resource base of the port, the basis of quoted prices for bonded, spot and far month shipments has remained stable on the whole, and cotton enterprises have maintained a cautious attitude. However, compared with Brazilian cotton and American cotton, the basis of Australian cotton shipment in July and September is significantly higher, and domestic cotton textile mills and intermediaries need to improve their enthusiasm for inquiries and signing contracts for Australian cotton in 2023/24.

July 15-16 Qingdao Port July September Shipping Time Aomian SLM 1-5/32 (strong 29GPT) basis is 11.5-12 cents/pound (benchmark ICE cotton 2412 contract); July/October Shipping Date M 1-5/32 (strong 29GPT) basis will reach 14-16 cents/pound; August/October shipping date Brazil cotton M 1-5/32 (strong 28-30GPT) basis difference is only 7-8 cents/pound (new cotton in 2023/24), and the price difference between the two is about 7-8 cents/pound.

Judging from the quotation of some cotton merchants, from July 15 to 16, Zhangjiagang and Qingdao bonded Brazilian cotton M 1-5/32 (Qiangli 28/29GPT) net weight quotation is 81.34-83.54 cents/pound (the price of Brazilian cotton at the port in 2022/23 is chaotic, and the difference between high and low prices is even more than 4 cents/pound, requiring buyers to compare goods), and the direct import cost under 1% tariff is about 14250-14630 yuan/ton; On July 16, 3129B (breaking specific strength 28/29CN/TEX, main grade 31) warehouse in Henan, Shandong, Jiangsu and other inland provinces quoted a price of 15600-15900 yuan/ton (128 yuan/ton for the buyer's package for three months). Considering the difference in net weight and public weight settlement, the current domestic and foreign cotton prices under 1% tariff are 1300-1800 yuan/ton, 400-500 yuan/ton more than that in the first ten days of July, The price advantage of imported cotton is becoming more and more prominent.

A textile enterprise above the designated size in Zibo, Shandong Province, said that the key to restricting cotton enterprises from signing contracts to purchase port bonded goods and shipping goods is that the cotton import quota issued in 2024 is too small. So far, there has been no news of the appeal for the increase of cotton import quota with sliding tariff for several months. The enterprise cannot achieve the goal of cutting costs and improving competitiveness Cotton textile and garment factories in Bangladesh and other countries are at a disadvantage. In addition, Mexico, Indonesia and other countries imposed tariffs on imported goods, the Red Sea transportation crisis, oil leakage from ships, strikes at many ports in Europe and the United States, and other factors made the marine market, which had been greatly reduced by congestion, container shortage and other problems, worse, and other factors also made the purchase and use of imported cotton by cotton textile mills sluggish.