Cotton Market Will Replace Temporary Storage In 2014.

Industry: direct subsidy will help improve domestic cotton self-sufficiency rate, and help Spin Industry out of difficulties

Next year, our country will cancel the cotton purchase and storage policy and replace it with the policy of directly subsidize cotton farmers. According to the insiders, cotton prices will be more marketable, and domestic cotton prices will be in line with international cotton prices, thereby stimulating domestic cotton prices down. At that time, the cost of cotton production in textile enterprises can be reduced and exports will be promoted.

It is reported that China will cancel the controversial soybean and cotton purchasing and storage mechanism, instead of directly subsidize farmers, and cotton farmers' direct subsidy policy will be introduced in March next year. Zhang Wenmin, general manager of Wanda cotton industry division, believes that the abolition of the cotton purchase and storage policy and the policy of directly subsidized farmers are the expectations of the vast majority of textile enterprises, which will bring positive benefits to the stability of the industry.

Recently, the relevant departments such as the Ministry of agriculture and China Textile Industry Federation have disclosed to the outside world the direction of the abolition of cotton purchase and storage, instead of taking the direct subsidy of the state. The basic decision is that in the year of 2014/2015, China's cotton temporary purchase and storage policy will no longer be implemented, and the direct subsidy pilot project may be implemented in Xinjiang. People familiar with the matter told futures daily that although the details of the cotton farmers' direct subsidy have not yet been finalized, there has not been a unified plan at the level of direct subsidy and direct subsidy. However, the policy direction that the state has shifted from temporary purchasing and storage to direct subsidy to cotton farmers has been determined.

"This makes the past temporary. store up The domestic cotton market with "price backing" has lost strong support. Many cotton enterprises believe that domestic cotton prices will fall next year, which will benefit textile enterprises and reduce the cost of cotton production by textile enterprises. In the long run, the move is a good way for the entire textile industry, helping narrow the price of cotton within and outside the country and stimulating domestic cotton prices to link up with international cotton prices. Central Plains futures cotton analyst Wang Wei said.

On the one hand, since the implementation of the temporary cotton purchase and storage policy in 2011, the state has accumulated about 10 million tons of cotton, accounting for 60% of the global inventory, on the one hand, resulting in huge storage capacity and financial pressure. On the other hand, the domestic and foreign cotton prices will eventually need to be integrated, and the biggest problem of purchasing and storage is the complete separation of domestic and foreign cotton prices. At present, the domestic cotton purchase and storage price is 20400 yuan / ton, while the international cotton price has dropped to 15000 yuan / ton.

"After the abolition of the temporary cotton purchase and storage policy, the cotton price will drop, which will help enterprises reduce the cost of raw materials, not only promote exports, but also help domestic textiles. clothing The industry is out of trouble. This year, the domestic market has plunged into an unprecedented downturn. The growth rate of the industry has dropped from single digit to two figure in many years. Wang Qianjin said.

For cotton farmers, cotton planting direct subsidy can directly increase the efficiency of cotton growers, thereby enhancing their enthusiasm for planting, improving the self-sufficiency rate of cotton in China and ensuring the safety of national cotton. Huizhou merchants cotton analyst Wang Shufei said, "domestic cotton loses the" bottom up "policy, cotton prices will fall sharply, which helps enterprises purchase raw materials at lower prices, thereby improving economic efficiency and revitalize the relatively depressed market.

At the same time, Wang Qian believes that from the purchase and storage to the cotton farmers direct subsidies, the state needs auxiliary throwing, storage and quotas and other policies to help change the overall downturn in the textile and garment industry.