New Cotton Season New Rules Of Price Formation Will Be Determined By The Market.

The cotton temporary purchase and storage system, which began in 2011, was officially abolished this year. According to the reporter's understanding, since the implementation of the cotton temporary purchase and storage policy, the international cotton price has been falling continuously for 3 years, and the difference between domestic and foreign cotton prices has been increasing. Two international and domestic markets are running double track system.

Since the beginning of this year, the price difference between the inside and outside per ton of cotton has reached a maximum of 6500 yuan, reaching a record high.

After the end of 2013~2014 cotton storage and storage, 11 million tons. cotton Enter the national storage cotton warehouse. With the huge amount of stock in the state reserve cotton being difficult to digest, a difficult link has formed: the domestic and foreign cotton prices are upside down, leading to the high cost of textile enterprises, the reduction of competitiveness and the loss of orders.

In this way, based on cotton temporary purchase and storage policies The related financial pressure and market pressure are gradually emerging.

"At home and abroad Cotton price The high and low price has reduced the competitiveness of Chinese textile enterprises in Global trade. Under the background of structural adjustment and industrial upgrading, the blow to Chinese textile enterprises is undoubtedly exacerbating. A textile industry believes that the purpose of China's acquisition and storage of cotton is mainly to protect the interests of cotton farmers while ensuring market supply, but when the policy of purchasing and storing up to third years is already difficult.

"Because domestic cotton prices are substantially higher than the cost of imports, market participants are reluctant to enter the market, and the pressure on State purchasing and storage has increased dramatically. The relationship between upstream and downstream prices has been distorted, and market vitality has weakened, which has adverse effects on the entire industrial chain." Li Guoxiang said that the prerequisite for effective implementation of the temporary cotton purchase and storage policy is that the domestic market price is lower than the international market price. But in the past two years, on the one hand, the price of cotton in the international market has dropped substantially; on the other hand, domestic cotton prices have been operating at a high level supported by the temporary purchasing and storage policy, and domestic prices have shifted from the international market to the cost of imports. The temporary storage and purchase policy is therefore difficult to continue.