In August, cotton imports increased by 30% and domestic cotton spreads slowed down significantly

Similar to the “roller coaster”-like trend of cotton prices since last year, the difference between cotton prices at home and abroad has also experienced great ups and downs in the past year. Relevant monitoring data show that during the 2010/2011 cotton year, the cotton price at home and abroad was once as high as RMB 6,000-7,000/ton, which has now fallen back to less than 2,000 yuan/ton.

According to customs statistics, in August this year, China’s imported cotton quantity continued to rebound, reaching 207,000 tons, an increase of 50,000 tons from July, an increase of 32%; the average import price was US$3025/ton, which fell by US$85 compared to July, a decrease of 2.7. %. In the first 8 months, China imported 1.69 million tons of cotton.

According to industry sources, the soaring and slumping of cotton prices since last year has caused a serious impact on the entire cotton industry chain. Increasing cotton import quotas is an important way to mitigate this shock.

"A reasonable supply and demand structure will make the cotton market stable." Analysts said that the current domestic and international demand has not recovered, but the global cotton production is expected to harvest, the situation of supply exceeding demand has been formed. In the new cotton year, both domestic and foreign cotton prices are expected to rise weakly.

Domestic and foreign cotton prices gradually approached the 2010/2011 cotton year (September 2010 to August 2011), and domestic cotton prices have experienced ups and downs of the "roller coaster" market.

According to Zhuochuang Information Monitoring, from September to early November last year, the price of cotton rose by more than 67% and became a “wind vane” for the bull market of bulk products. In February of this year, the price of cotton rose to a record high of 30,000 yuan per ton, and then the spot and futures prices of cotton began to fall all the way until it fell to the lowest closing price of 19,800 yuan/ton. In March this year, the domestic and foreign cotton price gap once reached 6,000-7,000 yuan / ton, with the domestic and foreign cotton prices plummeted, the current spread has been reduced to 2,000 yuan / ton.

According to an announcement released on September 14 by the China Central Cotton Information Center, although the quantity of imported cotton in China continued to rebound in August, the price dropped back to less than US$3,100/ton. In the September supply and demand report released by the U.S. Department of Agriculture, the forecast for China's cotton imports in 2011/2012 was revised upwards. The report shows that China's cotton imports in 2011/2012 are estimated at 14.5 million bales; while in the same period last year, China's cotton imports in 2010/2011 are estimated at 11.98 million bales.

"From the cotton trade point of view, there is a certain gap in China's cotton. In recent years, the annual import volume is more than 2 million tons." Zhou Shanqing, Ministry of Foreign Trade of the Ministry of Commerce stated that China is the world's largest cotton importer and the largest exporter of textiles and garments. Country, domestic and foreign need to be closely related.

Data from the General Administration of Customs shows that in the first half of the year, China’s garment exports increased by more than 20% year-on-year, but Wang Textile, an analyst at First Textile Network, believes that this is actually an increase in book value caused by price increases. The increase is only about 2%.

"Weak exports, sluggish domestic demand, and the downturn in the upstream and downstream textile industries are a good explanation for why China's cotton prices will plunge abnormally during the June-August season," said Sun Liwu, an analyst at Zhuo Chuang Information Cotton Industry.

Wang Qianjin believes that when the price of cotton fell from a high price of 30,000 yuan/ton to around 25,000 yuan/ton, the market generally believes that the departure of hot money has led to this result. However, it fell again and again until it fell below the protection price set by the government at 19,800 yuan/ton. This makes it necessary to sort out the supply and demand factors in the cotton market itself.

The recovery of cotton prices still depends on the end demand “because the impact of the previous surge in cotton prices, the general increase in cotton prices, domestic demand has been greatly inhibited.” Sun Liwu said that at the same time, European and American countries are in deep debt crisis, domestic demand is still weak, Caused by the drag on the cotton textile industry.

The China Cotton Association believes that the growth rate of the textile industry in the new year may continue to slow down, and cotton demand is expected to remain at the level of the previous year, ie 10 million tons. According to monitoring by the China Cotton Association, as of the end of August, there were nearly 500,000 tons of national commodity cotton turnover stocks, which was close to the average level, but increased by nearly 1.5 times year-on-year.

"Demand has not recovered, but the global cotton production is expected to have a bumper harvest. The situation of oversupply has already been formed." Sun Liwu said that with the original inventory, cotton prices rose weakly in the new cotton year.

Sun Liwu added that the rapid rise in cotton prices last year gave cotton farmers an idea that they would be willing to scrimp on prices, but did not expect cotton prices to flow down in just a few months. If they were bought at current market prices, they would definitely lose money.

Some people in the industry believe that due to the ups and downs of cotton prices, acquisition and processing companies are afraid to open up their acquisitions, stop production, and the normal operations of textile companies are seriously affected.

In this regard, Shandong Weiqiao Textile Co., Ltd. Minister of raw materials supply Wang Zhao stopped that the 2010 cotton prices soared and tumbled on the entire cotton industry chain has caused a serious impact, increase the cotton import quota is an important way to slow down the impact.

Sun Liwu also said that the real recovery of cotton prices has to rely on terminal demand to pull up. Most of China's cotton textile products are exported to foreign countries. However, the global economy is not optimistic. The appreciation of the renminbi, the substantial increase in labor costs, Europe and the United States debt problems that plague the global economy, and export resistance may continue to affect the market.

Related news The latest State Reserves sugar transaction price fell 650 yuan / ton over the expected "Sugar Emperor" was suppressed. Yesterday (September 19th), the average transaction price of the Ninth National Reserve's ninth batch of 7021.83 yuan/ton was announced. Compared with the average price of 7,672 yuan/tonne for the eighth batch of reserve sugar auction on August 22, it fell by approximately 650 yuan/ton. Ton.

Affected by this, in mid-August, the price of sugar that had exceeded 8,000 yuan/ton fell sharply. Among them, in the spot market, the sugar refineries in Yunnan and Guangxi have reduced their ex-factory prices by 80 to 150 yuan/ton. In the futures market, Zheng Sugar’s monthly contracts have started to go low and they have staged “Black Monday” again.

Yunnan Sugar Network News, in the ninth batch of state-owned sugar auction on September 16, the highest transaction price of 7370 yuan / ton, the lowest price of 6230 yuan / ton, the average transaction price of 7021.83 yuan / ton, the total turnover of 200,000 tons, transactions The amount was 1.442 billion yuan.

"Compared with the previous market forecast of an average price of 7300 to 7400 yuan / ton, the State Reserve's sugar drop has doubled." Zhuo create information analyst Wang Baodong told reporters that the average transaction price has decreased, has quickly affected Spot market.

Yunnan Sugar Net said yesterday that the spot price of sugar in the Yunnan spot market was significantly reduced. The price of Kunming Sugar Enterprise Group is reduced to RMB 7,300/ton, the amount of large quantities is also discounted by RMB 20 to RMB 40 per ton, the prices of middlemen are all under RMB 7,300; the quotation of sugar companies in Guangtong and Dianwei are reduced to RMB 7,150/ton Compared with last Friday, it was lowered by 80 yuan, and another broker offered a low of 7,120 yuan/ton.

Analysts believe that the State Reserve's sugar auction price has fallen sharply, reflecting that the end-users are no longer chasing after the global supply is expected to improve. They are cautious about the market outlook.

The analysis of UOB Futures, the end of the sugar season in summer and the industrial inventory surpassing market expectations over the same period of last year, coupled with frequent stockpiling by the country, also brought greater pressure on the sugar market. This is the main reason for the recent fall in spot prices. Incentives.

Recently, the market is generally expected that there will be one million tons of sugar in Hong Kong from October to October. Imported sugar will increase the pressure on domestic stocks. According to industry sources, the new crop season will begin in late September and early October. Dealers, production and consumer companies will all have clearance requirements and their willingness to purchase will decline.

"High inventory levels, new sugar imports, and imported sugar to Hong Kong will all play a role in suppressing the future development of sugar." Wang Baodong said that after entering the off-season, white sugar will not have any significant gains.

However, some analysts believe that the possibility of the State Reserve’s sugar selling in October is not significant, and that the current price will support the price of sugar due to the increase in production costs.

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