International Observation: Why Did The US Cotton Arrive In Hong Kong Again In May?

According to customs statistics, in May 2020, China imported 70 thousand tons of cotton, a decrease of 43.9% compared to the same period, a decrease of 60.7% compared with the same period last year. Since the 2019/20 (2019.9-2020.5), the total import of cotton has been 1 million 223 thousand tons, a decrease of 24.43% compared with the same period last year, and the import volume has been significantly larger than that in April.

In May 2018 and May 2019, China's cotton import volume was 130 thousand tons (an increase of 52% over the same period) and 179 thousand and 800 tons (an increase of 36.51% over the same period), so May is not the low season for cotton import and consumption demand. It is understood that in May, the number of US cotton arrivals continued to occupy the first place in 2019/20, while India cotton, Brazil cotton and West Africa cotton were closely followed, but the gap was widened.

Why did the US cotton arrivals and customs clearance in 4/5 months have always been the top?

First, the outbreak of the new crown epidemic in Brazil has been greatly affected, and land transportation, storage and port shipping have been greatly affected. Up to June 29, 2020 Beijing time, Brazil has accumulated 1345254 confirmed cases, the epidemic has been completely out of control. Therefore, the capacity of cotton transportation and transportation has declined significantly (such as Santos port congestion).

The two is the direct export quotes of India cotton FOB and so on in 2019/20, which are 6-8 cents / lb lower than that of the US cotton and Brazil cotton. However, due to quality deviation, heavy impurities, poor packing and so on, the goods will be affected. China's large and medium-sized textile enterprises (with import quotas) and traders are not very "cold" for India cotton with low quality and low price, so the number of India cotton shipped and arrivals in 4/5 month is against the bottom. But the range is limited.

Three, the Chinese side strictly tightened the inspection of Australia cotton, West African cotton, Brazil cotton and India cotton in order to strengthen the inspection and supervision of import and export commodities and strengthen the risk monitoring of imported commodities from high-risk countries and regions. Some foreign cotton exporters and international cotton traders have increased their worries and shipments have slowed down.

The four is the wide fluctuation of the RMB exchange rate in May, which shows the restriction and influence on the import of Chinese enterprises. In the last week of May, the RMB exchange rate against the US dollar once exceeded 7.17, hitting a new low since September 2019. The shipment and delivery of non US cotton were also suppressed.