How Big Is The Impact Of Reserve Cotton On Cotton Prices In May 5Th?

Facing the recent domestic and foreign spot cotton price oscillation upward, many textile enterprises responsible person is very anxious, very worried that raw material prices will continue to make them difficult to survive, the market is very much hope that the stock of cotton can enter the market early to "rescue".

Good rain knows season, but spring happens.

It's just a good day to grow melon seeds and beans. The domestic cotton market has "timely rain". Is this spring rain "expensive"?

What far-reaching impact will it have on the market?

"Timely rain" - 1 million tons of central reserve cotton has been rotated into the market since May 5th.

In April 23rd, the State Grain and material reserve bureau and the Ministry of Finance announced that in order to optimize the structure of central cotton reserves and ensure good quality, some central cotton reserves would be rotated in 2019.

The notice indicates that the time of reserve cotton rotation is the national statutory working day from May 5, 2019 to September 30, 2019.

The total quantity of round trips is about 1 million tons.

We should put in a balanced operation and sell about 10 thousand tons per working day in principle.

What is the difference between this "timely rain" and previous years?

First of all, from time to time, the stock of cotton entering the market is relatively late.

For example, the start time of the national cotton rotation in 2017/18 is March 12, 2018.

Secondly, from a quantitative point of view, the number of stocks of cotton entering the market is relatively small.

For example, in the year of 2017/2018, the rotation of the national cotton reserves began in March 12th and ended in September 30th. The total turnover of cotton reserves was 2 million 505 thousand and 900 tons, with a turnover rate of 58.12%.

In September 30, 2018, the sales volume of the reserve cotton wheel was 30037.8829 tons, and the actual turnover was 9824.4605 tons, with a turnover rate of 32.71%.

The average paction price is 14674 yuan / ton (down 169 yuan / ton compared with the previous day), and the 3128 price is 15853 yuan / ton (down 281 yuan / ton compared with the previous day).

Finally, due to the fact that the relevant implementation rules have not yet been published, there are still many other aspects to be estimated.

The impact of central reserve cotton 1 million ton rotation into the market

Wang Xiaobei, a senior analyst at Hongye futures cotton, said that, in a simple way, the dumping policy fell into a short term.

Judging from the current spot cotton trade, low price upland cotton is favored by the market this year. Textile companies are waiting for low price cotton to supplement low production and low cost.

The deal is expected to be more popular and will boost spot cotton prices.

In addition, from the total amount of cotton reserves, a round of imports is expected to support the formation of cotton prices.

"The impact of this throw on the market is neutral and will not cause too much impact on the market."

Wu Faxin, chief strategy officer of Shanghai yarn & amp; Technology Co., Ltd., said that one was expecting early speculation. In March, people in the industry were asking questions: "how can we not announce the news of dumping?

And throw it away? "

Therefore, this throw away store belongs to the "boots landing, the bearer cash", everybody does not have to make a fuss.

Two, the volume of 1 million tons is a theoretical "listing amount", and the volume of real daily turnover may be lower than the "listing amount".

That is to say, if 100% pactions are not done every day, the final total may still be less than 1 million tons.

The three is the content of the "announcement" to pave the way for "turn in".

We need to focus our attention on how and how the price of cotton will be imported into the country.

Four, at present, "low grade" cotton is selling fast. This "throwing store" just fills the gap, which is very advantageous to the textile enterprises.

Five, after the baptism of the market in recent years, the level of regulation and control of the relevant institutions has been greatly improved.

In short, throwing storage + quota issuance, raw materials for textile enterprises are guaranteed, therefore, for the whole industry, the price of upstream raw materials is stable, which is conducive to the healthy development of the whole industry.