State Control Policies On Cotton Prices And Textile Enterprises Are Still In Trouble

By the state will implement the temporary purchase and storage policy, this year cotton imports no longer issued quotas news, recently

There has been a big increase.

However, from the industrial perspective, the textile enterprises are still in the "endless winter" because of poor sales, and the "warning" of the cotton market has not been lifted.

Since the bottom of July, cotton has followed suit and started a moderate rebound.

In this round of quotations, "policy market" has become the leading factor in cotton price trend, and the latter is completely moving along with the state regulation policy.

On Tuesday, the China Cotton Association meeting came to the news that the state will implement the temporary purchase and storage policy, and this year cotton imports will no longer be issued quotas.

The cotton price rose considerably.

However, from the industry perspective, because of poor sales, textile enterprises are still in "endless winter", which means that the "warning" in the cotton market has not yet been lifted.

State control policy on cotton price trend

Since July, Zheng cotton futures have rebounded nearly 7%.

Behind the strong trend, the "visible hand" of policy is indispensable.

"The strength of cotton futures is mainly affected by the state's policy on cotton regulation and control."

Li Panfeng, director of the lead research and development center, told reporters.

Earlier, in 2012, the national cotton situation analysis conference, the responsible person said that after September 29th will suspend the release of cotton reserves, and effectively prevent spinning cotton, which means that the pressure on cotton will continue to shrink in the later stage, and the storage and purchasing effect will become the dominant factor in the market.

At the meeting of the China Cotton Association on Tuesday, Zhang Xianbin, director of the economic and trade division of the NDRC, introduced the new year policy: the current implementation of the temporary purchase and storage policy; the smooth operation of the price is the main keynote; imported cotton is not studied for the time being; it will not be issued later this year.

The supply and demand situation will be determined again next year. The reserve is to meet the market demand before the listing of new cotton in the new year, and new cotton will start to store. Therefore, it is decided to stop throwing storage and strictly control the cotton rotation.

Boosted by the news, the cotton 1301 contract closed at 19810 yuan / ton on Tuesday, up 1.30%.

Wang Yong, an analyst with Hongyuan futures, said: "the new annual policy of the China Cotton Association Conference involves the current implementation of the temporary purchase and storage policy, and indicates that the imported cotton will not be studied for the time being, and the quota will not be issued later this year.

In addition, the news of the sale of cotton reserves began in September 29th, and it is sensible for Zheng cotton to respond.

However, the industry believes that the rise of cotton can not be extended.

Li Panfeng said that because of the low price of the outer cotton and the excessive price difference between the internal and external markets, the domestic spot price is now at a standstill of 18600 yuan / ton, and the 20400 yuan / ton purchase and storage price has been uplink at the attraction price period, and has also become the pressure level of cotton price upward.

Textile enterprises are still in trouble.

As the downstream of cotton, the textile industry's cold and warm determines how far the cotton market can go.

However, due to the slow improvement in sales, Chinese textile enterprises are still in a state of general loss.

"At present, textile enterprises are very difficult and are generally losing money. This is also a reason why the rise in cotton prices is unsustainable."

China International Futures analyst Chen Ping told reporters.

Wang Yong said that the main problem that plagued China's textile enterprises is the order problem, which is an "old, big and difficult" problem.

In the past week, China's reserve cotton sales and warehousing business continued to advance, and the auction rate and paction price both showed a downward trend, indicating that domestic cotton demand has not recovered, and textile enterprises still have no confidence in the market outlook.

"Domestic raw material costs and labor costs have increased rigidly, and the quality of textile exports has yet to be improved.

The lack of added value makes it difficult for enterprises to completely pfer costs, which leads to the current survival of cotton spinning enterprises is still difficult.

A cotton textile spot enterprise said.

From the perspective of industry, the industry experts suggested that when the state issued cotton quotas, the industrial clusters would be tilted, appropriately changing the way of issuing cotton quotas for enterprises only in the past, and appropriately increasing the quota allocation for textile industrial clusters.

In addition, we should increase support for technological innovation and industrial upgrading of textile enterprises.

Appropriate release

Market, reduce cotton circulation links, direct subsidies to cotton farmers, as soon as possible so that cotton prices, quality standards, marketing methods and international market integration.