Project undertaking: Beijing Cotton Outlook Information Consulting Co., Ltd.
Monitoring objects: 100 cotton textile enterprises in 18 major cotton producing and consuming provinces
In September, the output of cotton reserves increased slightly, and enterprises were active in bidding, with all transactions continued. Affected by factors such as rising commodity market prices, domestic and foreign cotton futures spot prices have risen sharply to a new high this year. In the middle and late months of the month, seed cotton from Xinjiang and the mainland began to be picked and put on the market, and the opening price was significantly higher than last year. Under the influence of the dual control and double reduction policies, textile companies have seen a decline in the start-up rate of textile production, a decrease in new orders, greater inventory pressure on yarn and other finished textile products, weakened downstream demand, and a decline in the price of finished cotton yarn products. During the same period, international cotton prices rose higher than domestic prices, and the price difference between domestic and foreign cotton prices narrowed compared with the previous month.
1. Changes in spot prices at home and abroad
1. Domestic spot prices rise To a new high
In September, the cotton reserves were actively traded, with a transaction rate of 100%. Domestic cotton futures rose sharply to more than 20,000 yuan/ton, driving the spot price of lint cotton to a new high since 2014. At the end of the month, China’s cotton price index (CCIndex3128B) was 19,104 yuan/ton, an increase of 977 yuan month-on-month; the monthly average price was 18,237 yuan/ton, an increase of 221 yuan month-on-month, and a year-on-year increase of 5,441 yuan.
2. Long-staple cotton prices rise
In September, affected by the increase in the price of fine-staple cotton, the price of domestic long-staple cotton continued to rise. At the end of the month, the transaction price of level 137 was 28,600 yuan/ton, an increase of 300 yuan month-on-month, which was higher than the China Cotton Price Index (CCIndex3128B) of 9,496 yuan in the same period, and the price difference narrowed by 677 yuan compared with the end of the previous month.
3. International cotton prices rose sharply, and the price difference between domestic and foreign cotton narrowed
September , international cotton futures spot prices have generally risen sharply, but the average price is still lower than domestic cotton prices. China’s imported cotton price index FCIndexM averaged 107.15 cents/lb, up 2.1 cents from the previous month; at the end of the month, it was 114.49 cents/lb, up 7.49 cents from the previous month. The 1% tariff discounted RMB 18,238/ton, which was lower than domestic prices during the same period. The spot price is 866 yuan, and the price difference between domestic and foreign cotton has narrowed by 224 yuan compared with the end of last month.
4. Cotton yarn finished product inventories increased and prices fell.
In September, the peak season for textile enterprises was not prosperous. Under the influence of the dual control and double reduction policy, power and production restrictions in many places led to a significant decline in the textile startup rate. Terminal demand has a greater impact, sales are sluggish, and finished yarn inventories are generally high. During the month, the prices of textile cotton yarn and viscose staple fiber both fell slightly, while polyester staple fiber prices continued to rise. Specifically, the transaction prices of pure cotton yarn KC32S and combed JC40S at the end of the month were 27,000 yuan/ton and 31,000 yuan/ton, down 300 yuan and 350 yuan respectively from the end of the previous month; polyester staple fiber at the end of the month was 7,370 yuan/ton, up from the end of the previous month. 440 yuan, and the price of viscose staple fiber at the end of the month was 12,000 yuan/ton, down 700 yuan from the previous month.
2. Analysis of factors affecting price changes at home and abroad
1. September The number of cotton reserves shipped out increased
In order to meet market demand, the number of cotton reserves listed on September 6 was adjusted to 15,000 tons. A total of 233,300 tons of cotton reserves were put on the market in September, an increase of 26,900 tons from the previous month, and the transaction rate was 100%. The average transaction price was 17,230 yuan/ton, a decrease of 178 yuan/ton from the previous month, and the price was 18,578 yuan/ton at a discount of 3,128 yuan, a decrease of 105 yuan/ton from the previous month. Among them, Xinjiang cotton was traded at 167,900 tons, an increase of 20,200 tons from the previous month, with an average transaction price of 17,313 yuan/ton, or 18,736 yuan/ton at a discount of 3,128; real estate cotton was traded at 65,500 tons, an increase of 6,900 tons from the previous month. The average transaction price is 17,018 yuan/ton, which is 18,174 yuan/ton at a discount of 3,128 yuan.
2. Reserve cotton will continue to be released
On September 30, relevant departments According to the announcement, the state will further strengthen cotton market regulation and increase the supply of market resources. An announcement was issued on October 7 that in order to promote the smooth operation of the cotton market and meet the cotton needs of cotton spinning enterprises, the first batch of central reserve cotton in 2021 will be organized from October to November 2021, starting from October 8 Deliver. During the launch period, in principle, about 15,000 tons will be released on each statutory working day, which will be dynamically adjusted according to market conditions and other circumstances.
3. Cotton shipments out of Xinjiang continue to decrease
September 2021 A total of 85,500 tons of cotton were shipped out of Xinjiang, a month-on-month decrease of 148,400 tons, or 63.4%. Among them, 47,700 tons were shipped by road, a decrease of 59,200 tons month-on-month and a year-on-year decrease of 29,600 tons. A total of 37,800 tons of Xinjiang cotton shipped by professional warehouses from Xinjiang were shipped by railway, a decrease of 89,200 tons month-on-month and a year-on-year decrease of 60,500 tons.
4. Zheng cotton futures rose, and registered warehouse receipts decreased significantly
September , Zheng cotton futures rose strongly in the middle and late days of the month. The end-of-month settlement price of the main contract CF201 on September 30 was 19,680 yuan/ton, an increase of 2,240 yuan, or 12.84%, from 17,440 yuan/ton at the end of last month. At the end of the month, 3,968 warehouse receipts were registered, discounting 158,700 tons, a decrease of 180,000 tons from the end of the previous month, and the registered warehouse receipts decreased significantly.
5. Downstream textile demand weakened
In September, major textile and garment provinces Jiangsu, Zhejiang, Guangdong, Fujian, Shandong, etc. are all affected by the “dual control” policy on energy consumption, mainly in the weaving and dyeing and finishing industries. At the same time, companies are also facing pressures and risks such as insufficient domestic demand growth momentum in the second half of the year, slowdown in overseas demand growth, and high raw material prices. Yarn inventories have increased and downstream demand has decreased.