According to feedback from cotton trading companies in Huangdao, Zhangjiagang and other places, Xinjiang’s cotton highway shipments have continued to decline since mid-January in 2019/20 and 2020/21 (in recent days, truck shipments from some regulatory warehouses in southern Xinjiang have continued to decline). Affected by factors such as the warehouse basically stagnant) and the slowdown in the progress of inbound and outbound warehouses in the mainland before the Spring Festival, and the advance of employee rotations, the procurement focus of cotton textile enterprises and middlemen who have raw material replenishment needs during the Spring Festival has been adjusted to the mainland warehouses 2019/20 and 2020/21 Annual Xinjiang cotton and 2020/21 Yellow River Basin cotton area 3128/3129 (4128/4129) grade real estate and port bonded or customs clearance foreign cotton (mainly Brazilian cotton, US cotton, Indian cotton).
A cotton import company in Shanghai said that in the past half month, inquiries and pickups from textile companies and traders have concentrated on foreign cotton spot goods at the port, or directly purchased foreign cotton with customs clearance quotations in RMB or textile factories and traders self- Customs clearance with a 1% tariff quota. On the one hand, the 1% quota and sliding tax processing trade quota in 2020 can be extended to be used until the end of February 2021; on the other hand, ports and warehouses have stepped up efforts to disinfect goods and improve prevention. According to the control grade, the impact of the shipment of foreign cotton from the warehouse is not significant, and the buyer’s delivery is basically normal.
For far-month shipments, domestic buyers are more cautious in signing contracts for purchases (such as 2020 Brazilian cotton in September/December, Australian cotton in May/June shipping dates, etc.), and there are few large orders. First, the contracted exports of U.S. cotton in 2020/21 have entered an “oversold” rhythm. The domestic remaining cotton grade, quality, spinnability and other indicators have declined in matching with the actual needs of Chinese textile enterprises; while Brazilian cotton and Australian cotton have deviated due to genetic differences. Factors such as high prices and cotton merchants’ price hikes have been ignored; second, the global COVID-19 situation is still not optimistic, and buyers are worried that tight shipping schedules and containers, rising sea freight, epidemic prevention and control and other factors will lead to poor contract execution; third, industry analysis The trend of RMB appreciation against the U.S. dollar will continue in 2021. If it is impossible to achieve a fixed exchange rate, locked exchange rate, or other means to avoid exchange rate risks, you need to be cautious when purchasing far-month cargo; fourth, U.S. Treasury Secretary Yellen said that Trump will comprehensively review Trade policy has attracted widespread attention from the outside world, and there is still great uncertainty in Sino-US relations. </p
