Why Is Xinjiang Cotton'S Reserves Declining?

In December 20th, it planned to close and store 120900 tons.

The actual turnover was 39220 tons, with a turnover ratio of only 32%.

Recently, the enthusiasm for storage and storage of cotton processing enterprises in southern Xinjiang has obviously cooled down.

The reasons are as follows: first, affected by the recent snowfall and cooling weather in Xinjiang's southern and Northern Xinjiang, a large proportion of cotton processing enterprises have reached 9% or more than 10% of the lint regain. The proportion of cotton that does not meet the storage requirements has increased significantly. Some manufacturers even worry that the moisture regain is more than 10%.

In addition, due to snowfall, cooling and humidity, the phenomenon of heavy losses in storage and storage enterprises has become more serious. The general deficit in southern Xinjiang has risen to 1.5%-2%, and enterprises have insufficient confidence in their storage.

Second, the state's purchase and storage continued until the end of March 2012, and the open takeover took part in cotton production in Xinjiang. After a 50% of the processing capacity of lint cotton, the wait-and-see attitude began to heat up.

On the one hand, the total amount of national storage and storage has exceeded 1 million 700 thousand tons, a large number of two or three grades of cotton have entered the national reserve, and the social circulation resources have declined. On the other hand, even if the cotton market is not improving in the 1 and February of next year, it will not be late for storage, and will occupy more than 100 yuan of bank interest.

Thirdly, judging from the grade of Xinjiang cotton's storage, the southern Xinjiang mainly consisted of two grade cotton, while the latter four in the late Northern Xinjiang. The three grade cotton became the main body of the gambling market of cotton processing enterprises.

On the one hand, the difference between the two or three grade cotton spot price in the mainland is only 100-200 yuan / ton, and the price difference between matching and futures is only 300 yuan / ton, while the difference between the storage level and the reserve level is 3%. The difference between the three or four grade cotton mainland stock is close to 1000 yuan / ton, while the storage level is only 3%. On the other hand, the overall grade and quality of Xinjiang lint in 2011 is quite high, and the spinnability of two grade and three grade cotton is not very different.

Fourth, the recent rise of matchmaking, Zheng and other markets provided certain hedging opportunities for cotton processing enterprises. Some Xinjiang cotton enterprises indicated that the actual profit of making 19-21 sets of futures on the futures market was higher than that of the storage or storage price, but at least the cotton enterprises offered a chance to bet on the market.

Fifthly, although the prices of India, Pakistan and Australia cotton and American cotton are less than 2000 yuan / ton cheaper than Xinjiang cotton, but due to the uncertainty of the tariff quota in 2012, cotton trading companies and small and medium cotton mills are afraid to place orders easily.

According to the analysis of the industry, as the state's purchase and storage will end at the end of March, the tariff quota will be issued at least until May, and the quantity will tend to be conservative because the state has already purchased 1 million tons of cotton as a means of regulating cotton price ahead of schedule.

Xinjiang cotton company believes that there is still a certain market for high-grade cotton in the second half of 2012 on the premise of the influx of high-grade cotton into the Chinese market and the adjustment of the national monetary policy.