From the feedback of cotton traders and foreign businessmen in Qingdao, Zhangjiagang, Shanghai and other places, since mid-December, bonded cotton (mainly RMB quotations, buyers need to bring their own 1% import quota within the tariff), customs clearance cotton inquiries and There are obvious signs of recovery in shipments. In particular, customs-cleared cotton (priced in RMB) has received attention and favor from cotton textile mills and middlemen, and transactions continue to be active.
Industry analysis shows that the rebound in imported cotton transactions is mainly caused by factors such as the widening of the price gap between domestic and foreign cotton and the overdraft of the 2021 cotton import quota by some buyers in advance. A large cotton company in Jiangsu said that since October, the sales of medium and high-quality Indian cotton in 2018/19, 2019/20, and 2020/21 have gradually improved (CCI has released lint quality, grade and other indicators that are more guaranteed), and have gradually been squeezed out. Brazilian cotton ranked second in China’s cotton import volume in October and November, second only to US cotton. On the one hand, in the past two months, the price difference between Brazilian cotton and Indian cotton with the same commodity inspection indicators has widened to 800-1,000 yuan/ton, and the price competitive advantage of Indian cotton has become more and more obvious; on the other hand, due to the short transportation distance, the increase in freight is not too big. It is highlighted that the impact of the epidemic on ships is relatively controllable. Therefore, the shipment and delivery of Indian cotton are normal compared with Brazilian cotton and US cotton.
From the survey point of view, the growth of cotton stocks in China’s main ports throughout December was not very obvious (the arrival volume and storage volume showed a slight increase before mid-December; while in mid-to-late December, the storage volume was flat or even Inventory has fallen slightly). In addition to the increase in customs clearance and bonded cotton (RMB quotation) trading volume, the slowdown in the delivery and warehousing volume of US cotton and Brazilian cotton in 2019/20 is also an important reason.
According to the resource statistics and estimates of several large international cotton merchants, import companies, and middlemen, as of the end of December, the total bonded cotton volume in China’s main ports may have reached 410,000-440,000 tons (due to estimates, some import and export), among which US cotton, Brazilian cotton, Australian cotton, Indian cotton, African cotton, Central Asian cotton, European cotton, etc. occupy the forefront. Among them, the inventory and cargo of Ukrainian cotton in 2019/20 and 2020/21 are higher than those in previous years. There has been a large decline. Bonded + non-bonded cotton stocks in Qingdao and surrounding areas have rebounded to 240,000-260,000 tons; cotton stocks in Zhangjiagang Free Trade Zone are about 70,000-80,000 tons, and the total cotton stocks in Shanghai, Nanjing, Ningbo, Guangzhou, Tianjin and other ports are about 80,000 tons. -100,000 tons.
Some traders believe that as the main force of Zheng cotton breaks through the previous high of 15,100 yuan/ton, the momentum of RMB appreciation is still relatively strong, and the “countdown” for the issuance of quotas within the 1% tariff in 2021, etc., in early and mid-January, The cotton inventory at the port does not have the conditions for a large increase and tight storage capacity. </p
