When Does Cotton Price Go Out Of A Steep Circle?

"If we sell cotton without making money, we might as well pull out grain as early as possible." A village in Zouping village, Binzhou City, Shandong Province Cotton grower Picking cotton bolls at their own door, he told reporters reluctantly. 11 in the first ten days of the month, the China Securities Journal reporter found in Shandong that cotton prices fell sharply, causing many cotton farmers to pull cotton ahead of time to grow grain, and cotton market transactions were deserted.

In Xiajin County, Dezhou City, Shandong Province, with "cotton capital", almost all families grow cotton. In October and November, it was supposed to be the peak season for cotton farmers to buy cotton and cotton traders. But this year, not only did they not see the cotton rush last year, but the cotton trade was also deadlocked.

"Now seed cotton picking has basically ended, but the sales progress is less than 10%." Ma Junkai, President of the cotton trade association of Dezhou City, Shandong Province, explained that "the price of seed cotton purchase is too low this year, which is about 3.9 yuan / Jin, down 3.20 yuan / Jin compared with the same period last year. Now that the farmers are selling, they can't get their capital back, so they don't sell them. Compared with last year's cotton prices continued to climb, cotton farmers want cotton prices to go up with strong emotions.

Zhang Minghao, a village in Xiajin Province, confirms Ma Junkai's explanation. "Last year, the seed cotton can be sold to 7.3 yuan per Jin. Now everyone is waiting for the cotton price to rise, at least to 5 yuan / Jin, we are willing to sell, so that it will not work hard for a year. Zhang Minghao counted a cotton seed cost account. "Labor costs have gone up this year. The cost of picking cotton has risen from 0.5 yuan per catty last year to 0.75 yuan this year. The cost of peeling cotton rose from 30 yuan per person per day to 40 yuan per person last year. After that, 20 kilograms of cotton produced 8000 kilograms of cotton and 8000 yuan of labor cost. In addition, 1000 yuan for seed buying, 4000 yuan for fertilizer and 20 yuan for cotton and agricultural chemicals cost nearly 30 thousand yuan. This is not the cost of working in cotton fields all the year round. According to the current price of 3.9 yuan / Jin, 8000 catties of seed cotton can be sold to 31 thousand and 200 yuan. This means that the family has been working in the cotton field for nearly a year and has hardly made any money.

Cotton farmers are not making money, and cotton producers are also suffering. Xiajin seed cotton trading market is Shandong's largest seed cotton trading market, but in this busy season, cotton business rarely appears. The huge trading market was cold and clear, with only a few motor tricycles waiting to be pulled. In the peak years of the past year, Cotton Traders outside the market would be blocked for several kilometers.

A cotton merchant in Zouping, Binzhou, reluctantly said, "this is the worst year for me to harvest cotton for six years. financial crisis It's worse. After a busy day, I collected forty or fifty Jin, which is far from the six hundred or seven hundred pounds I received last day. Moreover, the quality of cotton collected this year is not good enough to sell to processing enterprises, and make less than 20 Fen catties. "

The direct reason for the fall in cotton prices, the injury of cotton growers and the desolate cotton market were the soaring cotton prices last year. Ma Junkai said: "cotton prices rose sharply last year, many farmers increased the area of seed cotton. Judging from the city of Dezhou, the area of seed cotton has increased from 1 million 550 thousand acres last year to 1 million 600 thousand acres this year. In addition, this year's rainy weather leads to a decline in cotton quality, which is also a reason for the low cotton price. Cotton growers and cotton merchants have to save their cotton first, but the risks are great. They must be fireproof, and prevent the cotton from changing color and quality. {page_break}

Price Skyrocketing It has become a common phenomenon in the agricultural products market, especially in recent years. Last year, garlic, ginger and cotton were dubbed "garlic ruthless", "Ginger you army" and "cotton palm" because of soaring prices, but after a short year, the prices of these farm products plummeted. Many experts believe that fluctuations in prices are not only objective factors for the supply and demand of disasters, but also the factors that lead to the disconnection of farmers' high price, the increase of planting area, the low price and the reduction of planting area, and the factors of fund speculation. They suggested that, on the one hand, we should establish a monitoring mechanism for the price movements of agricultural products, strengthen the initiative and effectiveness of state regulation, improve the linkage mechanism between price fluctuation and low income subsidies, and on the other hand, establish a large agricultural product planting plan to increase the possibility of basic balance between supply and demand. And state regulation should be carried out more by market means to prevent excessive injury to the economic fundamentals.

Li Jian, director of the Ministry of Foreign Economic Research of the Ministry of Commerce, believes that the key to deal with the sharp rise and fall of agricultural products is to establish a coordination mechanism. China's agricultural production is still in the household production and decentralized household production and operation, without scale, vulnerable to large-scale capital control. In western countries, the production of agricultural products is characterized by intensification and scale. Moreover, farmers set up their own coordinating bodies such as farmers' associations to coordinate their agricultural product acreage according to the market situation every year, which is similar to achieving the quota production effect, so that the annual output and price base of agricultural products will remain stable. China should also have such a mechanism, but it takes a long time to establish it.

The head of a large textile enterprise suggested that Xinjiang should be a few rare cotton suitable for high quality cotton cultivation in the world. The cost of cotton production is low and quality is good. The state should guide Xinjiang to develop this advantageous industry through policy support, strengthen Xinjiang's strategic position as a cotton supply area, and ensure the cotton planting area and supply in Xinjiang.

Some experts believe that the sharp rise and fall of cotton prices is a special situation in the past ten years. The key to solve these problems lies in national regulation. This year's first set of 19800 yuan / ton of open storage price is the embodiment of regulation, which has played a certain role in stabilizing cotton prices and preventing cotton prices from falling. The difference between this regulation and the past is that the previous purchase price is the price fixed by the state, so it is an unfixed price. This year's reserve price is the fixed price set by the state after considering the domestic and international factors. This year's storage will be sold at this price. It is estimated that the regulation of cotton prices in the future will be regulated first by setting up the reserve and storage price, and it is foreseeable that the price of cotton purchase and storage will continue to rise every year.

After the crash, what worries people is skyrocketing. Zhang Yanlin, research director of CIC, said that if cotton growers are affected by the market situation again and adopt blindly follow the wind planting plan, the sharp reduction of cotton production area will greatly affect cotton production, which is bound to set off a new round of cotton price "roller coaster", so that the industrial chain is again frustrated. Affected by this high frequency price impact, some SMEs in the industrial chain will be pushed to the edge of survival and will further restrict the development of the industry.

In fact, this worry is likely to become reality next year. Ma Junkai told reporters that many farmers have been pulling cotton seeds for wheat. Judging from the current statistics, the cotton planting area in Dezhou will be reduced to 1 million 400 thousand mu next year, a decrease of 1/8 over the same period.