Since July, affected by factors such as strong cotton demand, tight cotton expectations, and financial support, cotton prices have continued to rise sharply, and then fell and stabilized as the country adjusted its reserve cotton rotation policy and other measures. After entering the new year in September, new cotton harvesting started sporadically, and the purchase price increased significantly. Especially after the Mid-Autumn Festival, machine-picked cotton began to be launched one after another. The purchase price exceeded 10 yuan/kg, and the price of lint cotton exceeded 20,000 yuan/ton. , futures prices have also risen sharply, far exceeding the affordability of textile companies, and market risks have significantly increased.
This round of price increases is driven by the overall increase in commodity prices, and speculation also plays a certain role. However, from the perspective of supply and demand, it is not enough to support excessive increases in cotton prices.
From the perspective of cotton supply, output is stable with a slight decrease, and resources come from diverse sources. According to a survey by the China Cotton Association, the country’s cotton planting area has declined year-on-year this year. However, due to generally suitable meteorological conditions and high yield levels, the total output has remained relatively stable, expected to be 5.83 million tons, a year-on-year decrease of 1.5%. In terms of imports, the state issued an additional 700,000 tons of sliding tax quotas, and import volume increased significantly. According to customs statistics, a total of 1.78 million tons of cotton were imported from January to August, a year-on-year increase of 49.3%. Regarding the release of reserve cotton, from July 5 to September 24, a total of 600,000 tons were traded, with a transaction rate of 100%.
From the perspective of cotton demand, the textile situation has improved, but the growth trend has weakened. Since the beginning of this year, my country’s textile production and sales situation has continued to improve. Cotton yarn sales profits are relatively high, and production and sales are booming, which has driven cotton prices higher. However, the support for gray fabrics, clothing and other downstream products has been declining. Especially in the recent past, the inventory of finished products has been obvious. Growth, price rises are weak, companies’ wait-and-see mentality has intensified, and there are still many uncertainties such as changes in the epidemic and trade frictions, making it difficult for cotton prices to continue to pass on. The China Cotton Association estimates that consumption in 2021 will be 8.43 million tons, basically the same as the previous year.
Cotton has the characteristics of centralized acquisition and year-round sales. The acquisition situation in the new year will have a significant impact on the market operation throughout the year. Especially in recent years, the proportion of machine-picked cotton in Xinjiang has increased significantly. , the collection is concentrated in a shorter period of time, and the risk is further increased. The current market sentiment is impetuous, and the mentality of betting on the future market has intensified. Especially in Xinjiang, there is a serious excess of processing capacity. There have been signs of competition for acquisitions, which may promote further price rises, lead to disordered acquisitions, decline in cotton quality and other problems, which is not conducive to the sustainable and healthy development of the cotton industry. . Without sufficient demand support, a sharp rise must be followed by a sharp fall, and market risks require a high degree of vigilance!
At present, the country’s market regulation resources are sufficient, which can effectively make up for the domestic cotton production and demand in the new year. gaps and ensure market supply. In the next step, relevant departments will take timely measures to strengthen market regulation according to market changes and textile demand situations, such as increasing the release of cotton reserves and increasing cotton imports. They will also strengthen supervision of the futures and spot markets, maintain the order of new cotton acquisitions, and severely crack down on speculation. , Promote the smooth operation of the market and the healthy development of the industry. The China Cotton Association reminds all parties in the industry to calmly analyze the situation, respond rationally, guard against business risks, and not to follow the trend of speculation or blindly enter the market to buy.
Since July, affected by factors such as strong cotton demand, tight cotton expectations, and financial boost, cotton prices have continued to rise sharply. Later, as the country adjusted its reserve cotton rotation policy, etc. Measures have been reduced and stabilized. After entering the new year in September, new cotton harvesting started sporadically, and the purchase price increased significantly. Especially after the Mid-Autumn Festival, machine-picked cotton began to be launched one after another. The purchase price exceeded 10 yuan/kg, and the price of lint cotton exceeded 20,000 yuan/ton. , futures prices have also risen sharply, far exceeding the affordability of textile companies, and market risks have significantly increased.
This round of price increases is driven by the overall increase in commodity prices, and speculation also plays a certain role. However, from the perspective of supply and demand, it is not enough to support excessive increases in cotton prices.
From the perspective of cotton supply, output is stable with a slight decrease, and resources come from diverse sources. According to a survey by the China Cotton Association, the country’s cotton planting area has declined year-on-year this year. However, due to generally suitable meteorological conditions and high yield levels, the total output has remained relatively stable, expected to be 5.83 million tons, a year-on-year decrease of 1.5%. In terms of imports, the state issued an additional 700,000 tons of sliding tax quotas, and import volume increased significantly. According to customs statistics, a total of 1.78 million tons of cotton were imported from January to August, a year-on-year increase of 49.3%. Regarding the release of reserve cotton, from July 5 to September 24, a total of 600,000 tons were traded, with a transaction rate of 100%.
From the perspective of cotton demand, the textile situation has improved, but the growth trend has weakened. Since the beginning of this year, my country’s textile production and sales situation has continued to improve. Cotton yarn sales profits are relatively high, and production and sales are booming, which has driven cotton prices higher. However, the support for gray fabrics, clothing and other downstream products has been declining. Especially in the recent past, the inventory of finished products has been obvious. Growth, price rises are weak, companies’ wait-and-see mentality has intensified, and there are still many uncertainties such as changes in the epidemic and trade frictions, making it difficult for cotton prices to continue to pass on. The China Cotton Association estimates that consumption in 2021 will be 8.43 million tons, basically the same as the previous year.
Cotton has the characteristics of centralized acquisition and year-round sales. The acquisition situation in the new year will have a significant impact on the market operation throughout the year. Especially in recent years, the proportion of machine-picked cotton in Xinjiang has increased significantly. , the collection is concentrated in a shorter period of time, and the risk is further increased. The current market sentiment is impetuous and the mentality of betting on the future market has intensified. Especially in Xinjiang, there is a serious excess of processing capacity.The scramble for acquisition signs may push prices up further, lead to disordered acquisitions, decline in cotton quality and other problems, which is not conducive to the sustainable and healthy development of the cotton industry. Without sufficient demand support, a sharp rise must be followed by a sharp fall, and market risks require a high degree of vigilance!
At present, the country’s market regulation resources are sufficient, which can effectively make up for the domestic cotton production and demand in the new year. gaps and ensure market supply. In the next step, relevant departments will take timely measures to strengthen market regulation according to market changes and textile demand situations, such as increasing the release of cotton reserves and increasing cotton imports. They will also strengthen supervision of the futures and spot markets, maintain the order of new cotton acquisitions, and severely crack down on speculation. , Promote the smooth operation of the market and the healthy development of the industry. The China Cotton Association reminds all parties in the industry to calmly analyze the situation, respond rationally, guard against business risks, and not to follow the trend of speculation or blindly enter the market to buy. </p
