It is not appropriate to look at the bottom of the cotton

Recently, Hebei, Shandong, Hubei and other places are reporting the price of the third grade cotton is about 13,000 yuan / ton, due to the cotton purchase price and sales price of only 100-200 yuan / ton of profit, some early high-cost companies to buy hoarding cotton even Slight losses, buying and selling companies reluctant to sell more sentiment. Although the real estate tertiary cotton inquiry has continued to rise, the number of cotton mills looking at the goods has also increased, but it has not formed sufficient buying power to promote the reversal of the spot market. In early March, Shandong Weiqiao Textile Group raised the purchase price of Grade 2 and Grade 3 properties of real estate to 13,100 yuan/ton and 12,900 yuan/ton respectively. It also relaxed on the inspection of “three wires” and miscellaneous water, but it was large. Cotton buying and selling companies are not caught in the cold. First of all, their repayment pressure is not high. Secondly, it is expected that the cotton shortage will appear sooner or later. The introduction of a series of cotton industry policies will push cotton prices upward.

Since the Spring Festival, after the domestic electronic market experienced a downturn and a slight rebound, it oscillated again and again in the past two days. The matching price and the spot price have been completely inverted. Zheng cotton price is still higher than the cost of warehouse receipts. I believe that the following aspects need to focus on:

1. How large is the real market for the ** market and the matching market? Judging from the positions held by the two markets and the industry's estimates, the ** market consolidation rate is above 60%, while the matching market may be above 80%.

2. After several rounds of throwing storage, the price increase of grain and other agricultural products has been suppressed, the tension between supply and demand has been effectively alleviated, and the phenomenon of grain and cotton disputes is hard to emerge.

3. In the current year, cotton will consume at least 5.1 million tons (average monthly consumption of at least 850,000 tons in the previous six months), of which cotton is at most 862,800 tons (imports in the first six months) and consumes at least 4.24 million. Tons of domestically produced cotton, if the beginning and ending stocks are not counted, theoretically domestic commercial stocks of cotton are only .1 (industrial stocks at the end of February) -30 (national collections) = 919,000 tons. However, the actual situation is that before the end of February, the spot supply is relatively adequate, the domestic large-scale cotton purchase and sale companies are "pick cotton self-respect", and some traders intend to "fall in bag".

4. In the wake of China's late quota and CCC ** inventory pressure and the impact of low-cost Indian cotton, during the Spring Festival, the idea of ​​pushing up cotton prices in an attempt to force Chinese companies to become paralyzed was frustrated, and then they actively recovered themselves. Most foreign cotton merchants increased the consignment of port bonded cotton. By early February, according to the China Cotton Information Network, the number of cotton outside the bonded area was 405,900 tons.

5. The bearish effect of the news is prominent: A. The pressure of quasi-quasi-tariff quotas "hasn't changed," and the cotton companies who praised the pressure on them have "difficult and dilemma"; The negative effect of the sharp appreciation of the *** in the China Fair and the shortage of high quotas in Europe and the United States appeared. "There are more exhibitors and less viewers". The trade surplus remained high, especially the trade surplus with the United States was outstanding. The trade surplus of the textile industry in 2006 accounted for 72% of the country's total trade surplus. For this reason, the state has repeatedly stated that it needs to adjust its industrial structure; In 2007, the central bank will continue to use tools such as deposit reserve ratio, interest rate, re-enactment and rediscounting to ensure stable economic growth. From the recent increase in the reserve ratio and the policy of raising interest rates, the funding environment facing cotton and cotton spinning companies may further deteriorate.

So, how do you view the cotton situation in the market? The author believes that, first, whether the cotton import quota under the sliding tariff is low or whether the value of the Khmer is discussed, under the control of the “high block, low suction” sliding tariff policy, the quota is likely to promote international and domestic cotton. The price rose. Second, although measures such as “refined subsidies” have been introduced, there is no significant increase in cotton acreage in 2007, and they will continue to fluctuate around 80 million mu. The first reason is that the area suitable for planting cotton is limited, and planting habits are not easy to change; Second, the benefits for cotton farmers are limited. There is a process of acceptance and comparison. It remains to be seen whether this policy of benefiting people can be implemented. Thirdly, the price increase of cotton prices is higher than that of cotton. Currently, the cost of most cotton enterprises' third-class cotton is in the range of RMB 12,800-13,000/ton, while that of later cotton purchases is RMB 12,800/ton or more. There is no profit for purchasing and marketing companies, and the limit for cotton mills is also above 13,500 yuan/ton. Fourth, from the January and February exports of textiles, with the further regulation of export quotas and the active cooperation of the domestic sales market during the “**” period, a leader stated that in 2006, China’s market consumption rate actually decreased. 51%, the decline in textile and apparel is relatively prominent), exports in the first half of 2007 will become the main driving force for the rise in cotton prices. Fifth, the expected increase in international cotton prices. Due to the limited export volume of high-grade cotton in India, the production of Australian cotton dropped to about 250,000 tons, and the cotton planting area in Central Asia declined. The majority of cotton in CCC’s cash inventories will be used to fill China’s supply gap. Therefore, from the perspective of fighting for the export market and the slowdown of China's quotas, the downward adjustment of US cotton prices is a strategic need. In order to prepare for the future development, short-term international cotton prices will remain in a weak consolidation. However, from the perspective of US cotton prices in the past five years, the current market is only near the midline. Sixth, the decline in the electronic market and even the inverse price of the spot price will not depress the cotton spot price. The demand side and cost factor are the supporting forces.

The author believes that some favorable policies will be gradually introduced later, after all, once the cotton purchase, sale and processing enterprises have suffered large losses, not only some cotton enterprises that participated in the reform of the 400-type quality inspection system will lose out, but also the performance of agricultural issuing and credit cooperatives. It has become a problem if it is timely and fully repatriated. The cotton spot and electronic trading should not be bearish or blindly followed up. The swinging price of cotton spot price is still locked at 13,000-14,000 yuan/ton.