According to statistics from relevant Brazilian departments, the export shipment volume of Brazilian cotton in the second and third weeks of October was 63,700 tons and 63,000 tons respectively, a significant increase compared with the third and fourth weeks of September and the first week of October ( Only 27,000 tons were shipped in the first week of October), among which buyers from China, Vietnam, Bangladesh, Turkey and other countries were more active in shipping.
According to customs statistics, in September 2023, China’s cotton import volume was 236,000 tons, a month-on-month increase of 34.48%, and a year-on-year increase of 164.99%. Among them, U.S. cotton imports were 107,200 tons, accounting for 45.41%; Brazilian cotton imports were 51,000 tons, Accounting for 21.60%, it rose to second place, with a month-on-month increase of 193.34% and a year-on-year increase of 344.58%. Brazilian cotton import volume and proportion of import volume have shown a strong rebound momentum, leaving Australian cotton behind again, and the gap with US cotton has narrowed significantly.
Some international cotton merchants and cotton importing companies said that due to the shock and decline of ICE cotton futures since mid-October and the reduction of the October/December shipping basis by Brazilian cotton exporters and traders, Chinese cotton textile companies and intermediate Business inquiries/signing contracts for Brazilian cotton have picked up compared with August and September. In addition, considering the October/December shipping schedule, the US cotton in 2023/24 is mainly EM 22-2/21-3/21-2 length 33/34/35 strength 26-29GPT low spinnability and low index resources. (Suitable for spinning OE and thick ring-spun cotton yarns); while the shipping schedules of 31-3 36/37/38 strong 28/29GPT “green card cotton” are concentrated in December/January/February and the western and southwest cotton areas of the United States. There is still a high probability of rainfall in the near future, and cotton wadding, harvesting, and processing may continue to be delayed. Concerns about U.S. cotton grades and quality indicators have once again heated up. Therefore, in order to prevent risks, some cotton-using companies have locked in some indicators in advance and can be spun. Brazilian cotton/Australian cotton with better performance to cope with changes in US cotton delivery.
Judging from the quotations of trading companies, the basis of Brazilian cotton M 1-1/8 (28GPT) in the October/December shipping period is concentrated at 8.5-9.5 cents/pound (ICE2312+basis); while the basis of M 1-5/32 (strong 28GPT) corresponding to the ICE2403 contract basis is 8-10 cents/pound; while the basis for the 11/12/1 month US cotton M 1-1/8 (strong 28GPT) is 12.25-12.75 cents/pound. It is 3-4 cents/pound higher than Brazilian cotton, and the cost-effectiveness and competitive advantages of Brazilian cotton are gradually restored.
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