Consumer Demand Dominates Zheng Cotton Trend

Last Friday, it was reported that the cotton planting area in the next year had dropped sharply, so that money had to go in.

Spot prices stabilized, and turnover did not improve significantly.

Lint prices have dropped since November, but the slowdown has slowed down.

Recently, in the vicinity of the market, the cotton (20615, -65.00, -0.31%) spot market has stabilized temporarily, and the market inquiry atmosphere has increased slightly. The price in some areas has even risen slightly, but it has not formed the mainstream of the market.

At present, Hebei's mainland cotton four class offer 18700 yuan / ton, Hubei good four level 18500 - 18700 yuan / ton.

As the price of cottonseed has stabilized, the purchase price of cotton seed has also increased slightly in the mainland. The three level quoted price is between 3.85 yuan and 4.15 yuan / Jin.

Although prices have stabilized, the local buying and selling atmosphere has been warmer, but the overall turnover is light, mainly due to the lack of orders for textile enterprises at present, and the purchase of raw materials is mainly followed by buying and selling.

Textile and clothing demand contraction

Customs data show that in November, Chinese textiles,

Finished product inventory of textile enterprises is at a high level.

The textile market is deserted, with fewer orders and lower profits. The prices of some enterprises are close to the cost line or even lower than the cost. Therefore, the textile enterprises continue to reduce production scale by limiting production and shutting down production. It is reported that the current enterprise start-up rate is less than 80%.

With the Spring Festival approaching, spinning enterprises or early holidays, there is an expansion trend of shutting down and reducing production.

As the early accumulation of more products, and the current sales are not prosperous, even if the production scale is reduced, the finished product inventory will continue to increase.

China cotton information network survey shows that as of the end of November, the average yarn stock of spinning enterprises was 20.96 days, an increase of 0.34 days, an increase of 8.52 days compared with the same period last year. Grey fabric inventory is also not optimistic, the average is 17.96 days, the increase of 1.78 days, an increase of 2.58 days compared with the same period last year.

If the downstream demand is still not improving, the high level of inventory will continue to restrict the bargaining power of enterprises.

The price gap between internal and external markets expanded further.

The European debt problem has been repeated and has not yet found effective solutions.

The market is worried that the economy will be dragged down, and the demand for textiles and clothing in Europe and the United States will be further reduced.

US cotton will break through the oscillation interval in the middle of next 11 months. At present, the US cotton contract price in March is near 87 cents / pound. The Cotlook A index has fallen below 100 cents / pound to 93 cents / pound, converted into RMB at 1% tariff, the price is about 16200 yuan / ton, and it is converted to 16700 yuan / ton according to the sliding tax.

While domestic cotton prices have shown a strong performance under the pro market policy, the 328 cotton price index of China's cotton spot index is about 19060 yuan / ton.

It can be seen that the difference between domestic and foreign cotton is further expanded, reaching a maximum of 2800 yuan / ton.

Cotton demand declined this year compared with last year, while imports showed the opposite.

In November, 378 thousand tons of cotton were imported, and the total volume of imported cotton reached 2 million 573 thousand and 400 tons from 1 to November, an increase of 199 thousand tons compared with the same period last year, an increase of 8.4%.

The increase of international cotton price premium is the root cause of this phenomenon.

Zheng cotton rebound support from the next year cotton planting area reduction and the Spring Festival textile enterprises after the replenishment is expected, the cotton market weakness can fundamentally improve, ultimately depends on the domestic and foreign macroeconomic trends, economic inefficiency directly leads to the downturn of consumer demand, in the reduction of consumption scale, even if the new annual production reduction is also difficult to raise cotton prices.

At present, the center of gravity of Zheng cotton moves slightly upward, and the short term is expected to continue to rebound.