Cotton Prices At Home And Abroad Have Been Rising, And The Cost Pressure Has Been Pushed To The Downstream

 

 

1、 Domestic cotton prices rise

 

The market still has strong expectations for new flowers, superimposed on the downstream expectations of the "golden nine silver ten" approach, and the long funds continue to follow up, supporting the domestic cotton price to continue to rise. From August 9 to 13, 2021, the average settlement price of main cotton futures contracts in Zhengzhou Commodity Exchange was 17760 yuan / ton, up 280 yuan / ton or 1.6% over the previous week; The average price of national cotton price B index, which represents the market price of standard grade lint in the mainland, was 17658 yuan / ton, up 160 yuan / ton or 0.9% over the previous week..

 

2、 International cotton price rises

 

CPI growth in the United States slowed down in July, and US stocks hit a new high in response to the call. The US Department of agriculture lowered global cotton production and final inventory in 2021 / 22, supporting the continued rise of international cotton prices. From August 9 to 13, 2021, the average settlement price of Cotton Futures (ice) main contract of Intercontinental Exchange was 91.89 cents / pound, up 1.45 cents / pound or 1.6% compared with the previous week; The average price of international cotton index (m), representing the average CIF price of China's main ports, was 103.8 US cents / pound, up 2.16 cents / pound or 2.1% compared with the previous week. The import cost of RMB 16734 yuan / ton (calculated by 1% tariff, including port miscellaneous and freight), increased by 341 yuan / ton or 2.1% compared with the previous week. The international cotton price was 925 yuan / ton lower than that of domestic cotton price, and the internal and external price difference was reduced by 180 yuan / ton compared with last week.

 

Third, the transaction price of reserve cotton rose

 

Reserve cotton auction continued hot, transaction price rose. From August 9 to 13, 2021, the average transaction price of reserve cotton was 17464 yuan / ton, an increase of 277 yuan / ton or 1.61% over last week; Among them, the average transaction price of Xinjiang cotton was 17531 yuan / ton, up 299 yuan / ton or 1.74% compared with last week; The average transaction price of real estate cotton was 17317 yuan / ton, up 283 yuan / ton or 1.66% compared with last week.

 

4. Cotton yarn prices at home and abroad are rising one after another

 

This week, with the rise in cotton prices, cotton mills again raised the price of cotton yarn, enterprise raw material preparation willingness is weak; Due to the impact of the epidemic, the transportation of goods and raw materials was delayed, and the price of imported yarn continued to rise slightly. Some traders said it was difficult to replenish. At present, the price of conventional yarn is lower than that of domestic yarn by 293 yuan / ton; The rise of the price of fancy yarn in the upstream has led to the increase of production cost of grey fabric, and the difficulty for the factory to receive orders, and the enterprises have slowed down their purchasing to maintain a wait-and-see manner. Polyester staple fiber by crude oil and PTA trend decline, prices continue to fall.

 

 

 

5、 Future prospects

 

The US Federal Reserve's discussion on the reduction of cotton continued. The international market focused on the change of cotton demand side, and the high price of cotton was waiting for guidance. The number of job vacancies in the United States rose to a record high of 10.1 million in June. Fed officials are still debating the timing of the reduction. The OECD warned that the momentum of economic growth in the United States, Japan and the euro zone showed signs of slowing down, and that economic activity would turn in the next six to nine months. In terms of the international cotton market,

 

    At present, the budding rate, boll setting rate and boll opening rate of American cotton are 88%, 63% and 5%, respectively, which are slower than those of the same period last year, but the proportion of good seedlings has increased by 23%; India's meteorological bureau predicts that monsoon rains will recover next week, possibly slowing production concerns. The U.S. Department of agriculture predicted in August that the global cotton production in 2021 / 22 will be reduced by 119000 tons to 25875000 tons, a year-on-year increase of 5.7%, and the consumption will be increased by 37000 tons to 26.851 million tons, with a year-on-year increase of 3.62%. As the main contract of ice cotton futures rose to 93 cents / pound in recent days, the spot price of foreign cotton increased, causing the buyer's resistance and wait-and-see mood, and the port buyer and seller fell into a stalemate.

 

    As Biden's federal unemployment benefits expire in September, industry insiders predict that the U.S. retail frenzy will fall by 5% to 10%, and terminal clothing will change accordingly. To sum up, cotton growth in the northern hemisphere has entered the weather observation window period, economic growth kinetic energy worries are beginning to show, cotton consumption expectations have not yet been settled, and international cotton prices are running at a high risk.

 

Domestic cotton market upstream atmosphere hot, downstream cost pressure further increased, to textile industry management potential risks. The central bank released the second quarter of 2021 monetary policy implementation report, said that the risk of economic growth prospects, will support the economy with moderate monetary growth, and further reduce the real loan interest rate. In terms of domestic cotton market, in August, Xinjiang cotton grew well and gradually entered the key period of boll setting.

 

    If there is no extreme weather in August and September, the good growth of cotton may make up for the impact of early extreme weather. According to the recent survey of China cotton net, more than 50% of the enterprises believe that seed cotton will rush to harvest this year. Zheng cotton prices rose sharply, spot basis, point price, buy it now prices have echoed the rise. The market reflects that the textile market in Guangdong, Jiangsu, Zhejiang, Shandong and other places has witnessed the phenomenon of traders gradually entering the market to stock up cotton yarn. The main consideration is that the "golden nine silver ten" of cotton textile industry is coming. However, the bargaining power of terminal domestic and foreign sales orders is relatively low, especially for weaving, fabric, clothing and foreign trade enterprises, which are mainly affected by the pressure of coordinated shipping, delivery and freight, and the enthusiasm of receiving, arranging and delivering orders is not high. In the short term, the domestic cotton price is constantly rising, the cost pressure is constantly pushing downstream, and the risk of high cotton price operation is also increasing.