Imported Cotton Price Advantage Subsided Textile Enterprises Procurement Need Caution

Recently, commodity futures represented by black varieties have seen a black whirlwind in the capital market. However, with market quotation, part market People have focused their attention on the 2011 star species cotton. Land resumed for nearly 10 months in just 9 trading days, and has rebounded to the level of last May. The strong rise of cotton futures is the return of the king.

According to the reporter, cotton A rare boom in futures is due to the changing demand and supply of cotton in short supply, and the market is in short supply of high-quality cotton. As of April 21st, cotton futures 1609 contract price has risen nearly 3000 yuan / ton on the 9 trading day, or 25.87%. On the 21 day, the main contract of Zheng cotton futures was opened at 12400 yuan / ton at 1609, closing at 13355 yuan / ton, with an increase of 6.46% during the day, and futures prices were close to the daily limit. Driven by the futures market, the spot market is also rising.

Import cotton price advantage subsided

Recently, the market expectations of the national cotton spinning and landing rules. "Notice on arrangements for rotation of cotton reserves in the state" clearly stated that the dumping time in 2015/16 was 31 days on May 3rd -8, and the total volume of output was not more than 2 million tons. fibre The inspection bureau organizes a comprehensive notarization test of quality and weight.

"The announcement on the rotation of national cotton reserves has been known by the market at the annual cotton futures conference in mid March. The announcement of the policy is only a confirmation of the speculation in the previous market. The short supply of cotton reserves has basically been digested by the market. In the long run, inventory pressure has been alleviated and has a neutral preference for prices. Liu Yi, manager of MEIKO futures research department, said in an interview with the China Times reporter.

Liu Yi said that from the futures market, cotton futures now have a strong momentum of growth, in addition to the promotion of funds, the downstream textile enterprises active replenishment of the price has also been promoted. The two principles of "multiple rounds, fewer rounds" and "priority of cotton production out of the national reserve and long storage time" are also fully in line with the expectations of the market participants.

Some foreign businesses are "stable, accurate, and ruthless" to describe the national cotton store's rotation. In particular, the price of the round trip is bundled with the CotlookA (real ICE futures) index and adjusts once a week to truly achieve the linkage, linkage and integration of cotton prices inside and outside the country, which is conducive to maintaining cotton price stability, enhancing the competitiveness of cotton textile exports and the "marketization" of China's cotton industry.

"According to the policy announced by the state, the pricing method of the National Reserve has been determined. The average value of the CotlookA (real ICE futures) index and the domestic spot price index in the previous week were 50%, adjusted once a week. The rotation time of 2015/16 is May 3rd, so the price of the round off refers to the price at home and abroad on April 25th -29, which is not yet available. Liu Yi said in an interview with reporters.

Regarding the calculation method of throwing and storing prices, Yang Zhijiang, general manager of Shanghai Century Boulevard, merchants futures, said that for investors, they should try not to do more than the calculation of throwing and reserve prices. According to the current domestic and foreign spot price situation, the domestic competitiveness will reach 12200 yuan / ton, and the competitive advantage will be gradually lost. The static judgement of 12200 yuan may be pressure.

According to the General Administration of customs, China imported 57 thousand and 900 tons of cotton in March 2016, an increase of 2.97% tons, an increase of 2.97% tons, a decrease of 70 thousand tons, or a decrease of 54.73%. In September 2015 -2016 March, China imported 575 thousand and 400 tons of cotton, a decrease of 434 thousand and 200 tons compared with that of the previous year, a decrease of 43.01%. In 1-3 months of 2016, China imported 209 thousand and 700 tons of cotton, a decrease of 238 thousand and 500 tons compared with that of the previous year, a decrease of 53.21%.

"Fundamentally speaking, China's cotton production is decreasing, and the output of cotton reserves has become normalized, and the supply side pressure has weakened. Domestic prices are falling, and the price advantage of imported cotton is also fading. In terms of yarn, imported yarn has little profit except for combed yarn. The price of other cotton yarn has been upside down, and the price of chemical fiber is also rising. In this way, the competitiveness of domestic cotton is enhanced and the supply pattern is changing, so we can watch more cotton. " Liu Yi analyzed reporters.

Textile enterprises should be cautious in purchasing

In April 15th, the policy of state-owned cotton storage and landing was dynamically adjusted, and the price was adjusted dynamically. This undoubtedly gave the market a reassurance. However, due to the decline in the quality of new cotton and the limited import of cotton, the market demand for high-grade cotton is relatively strong. At present, the storage time of the national reservoir is 2-3 years, and the quality grade is less than 3.

At the same time, the market is not short of low price cotton, so the priority of exporting cotton is in line with market demand. The industry believes that the current inventory of enterprises is not high, the downstream off-season, late replenishment needs, but will not release for a short time. Therefore, it is not recommended for downstream enterprises to increase procurement volume.

It is understood that due to the continuous rise in cotton prices in China in 2011, and a record high, leading to a larger cost advantage of imported cotton, followed by the downward trend of the world economy, limited consumption, inventory backlog, cotton prices continued to fall. However, in 2016, the price of cotton in China was close to the price of imported cotton, and the import profit was shrinking.

In recent years, because of the continuous low innovation of cotton prices, who has large inventories and who lose money, many enterprises have reduced their inventories to a low level, which leads to serious shortage of inventory in the current industrial chain. In the medium to long term, the current industry generally expects that the rhythm of reserve cotton going to stock is only within 2 million tons, and the amount of stocking is very small, and the impact on the price is not great.

"From the historical trend of cotton prices, at the beginning of the year, less than 10000 yuan / ton has been in the low price range of nearly ten years. High inventory, low consumption and high substitution are the main basis for low prices and short strategy. However, if one Yang changes three views, the fundamentals will be spanformed instantaneously, the price ratio is low, and the macro expectation is good, which can bring upward rebound. But continuous inflation has great harm to the market and the formation of the industry. There have been physical enterprises that can not judge the future trend. Ren Xinpu, vice president of Yongan Futures Research Institute, said in an interview with the China Times reporter.

Ren Xinpu said that this strong rebound is not necessarily a sign of rising price of spot cotton, and the production of textile enterprises should be arranged according to their product mix and market demand. It is recommended to pay attention to the origin, batch, quality indicators and storage locations of imported cotton, and do a good job in spanaction market inspection, spanportation and other related work. Order is the foundation, price and quality are the key, impulse is the scourge.

Ren Xinpu pointed out that half a month ago, in the Jiangsu and Zhejiang textile enterprises, the survey showed that the order quantity was different, the starting rate was large, the differentiated enterprises were higher, the conventional yarn enterprises were lower, the colored spun yarn was better, the white yarn was worse, the high count yarn was better, and the low count yarn was slightly worse. In terms of business efficiency, pure cotton spinning, low count yarn and conventional varieties have little achievement, and high count yarn and colored spun yarn are better.

Based on the expected decline in cotton prices, raw materials and yarn stocks are generally not high. Futures prices reflect expectations, but in view of the current domestic and external situation of the textile industry and cotton consumption and cotton substitution, demand does not support a significant increase in cotton price raw materials.

For the post market price trend of cotton, Liu Yi said that at present, small businesses have gone bankrupt, and those who survive have a certain market share. Now is the off-season consumption, terminal demand is not fully up, there is still demand for procurement in the late stage. In the long run, the supply pressure is reduced, and the substitution of yarn and chemical fiber is also weakening. The negative factors have been gradually reduced, and the basic pattern has changed. In the long run, cotton prices have limited space. In the short term, the factors restricting the space above the price should depend on the purchasing power of the enterprises.