After the ups and downs of cotton prices, where to go? Does the state's support for the market support the geometry? **How to operate the market. With these questions, the author recently participated in research activities conducted in the main cotton producing areas in Shandong and Hebei, and cotton industry gathering areas. The study concluded that cotton prices will fluctuate around 19,800 yuan/ton before March next year. In the 18800 ~ 20800 yuan / ton range fluctuations.
The cotton harvest has already become a foregone conclusion to the relevant person in charge of the Lumian Group of Shandong Province. In early September, Shandong experienced continuous rainfall, which had a certain impact on the quality of cotton production, but it did not hinder the overall situation of this year's bumper harvest. According to data from the National Bureau of Statistics, China’s total cotton output was 5.97 million tons last year and it is expected to reach 7.48 million tons this year, an increase of 25%. Among them, China's major cotton producing areas in Xinjiang are becoming more affluent, and the quality and output of cotton have been greatly improved compared to last year. Industry insiders estimate that they can even increase production by 30%.
According to the data from the U.S. Department of Agriculture, global cotton production has also increased this year. Global cotton production this year is expected to reach 27.04 million tons, a record high. Global demand is stable at 24.9 million tons. This year's supply exceeded 2.14 million tons.
From the perspective of cotton warehouses in Shandong and Hebei, the main types of low-grade cotton in the previous years were dominated, and the total amount was less than in the same period of previous years. In the two warehouses under investigation, the cotton belonging to the Zhengzhou stock exchange was mostly grade 4 cotton. Qingdao Port is the main port for China's imported cotton. At present, the number of cotton outside the port is mainly African and Australian cotton. The total amount is about 40,000 to 50,000 tons, and the storage is also scattered.
Before the end of this year, Brazilian cotton and Indian cotton will be concentrated in Hong Kong. In the future, the price of Indian cotton may fall below 19,000 yuan/ton. Therefore, companies generally believe that in the 18,000 yuan / ton to 18,500 yuan / ton range, the purchase of imported cotton is more secure, the current mentality is still very cautious.
The textile company has not yet recovered its vitality. The person in charge of Weiqiao Group, the largest cotton textile company in the world, introduced that the company's current purchase price for Grade 3 cotton is 19,800 yuan/ton, which is in line with the national collection and storage price. Weiqiao Group's textile scale is 6 million to 7 million spindles, and the annual cotton consumption is about 800,000 to 900,000 tons, which is equivalent to 8% to 9% of China's annual cotton consumption.
According to the relevant person in charge of the Lumian Group, the current prices of imported cotton yarns and home-made cotton yarns are quite the same, and the sales of cotton yarns are basically stable, but the company's cotton yarn stocks are relatively high, and the downstream orders are mainly scattered, and the long list is lacking. The previous sales of grey cloths once improved, but now it seems to be a flash in the pan and the downstream demand is insufficient. Similarly, the situation of polyester-cotton yarns and polyester-cotton fabrics is similar, or structural oversupply will occur.
In Hengshui, Hebei, relevant sources said that this year's ups and downs of cotton prices have had a great impact on the cotton textile industry, and corporate funds have been relatively tight. In addition, after the country raised the deposit reserve ratio, the bank’s loanable funds decreased compared with previous years, and enterprises are more cautious about purchasing cotton.
According to the relevant person in charge of the Cotton Association of Texas in Shandong, March to July this year is the most difficult period for the textile industry. Local cotton textile companies lose almost 100% of their profits, with losses ranging from a few million dollars to as much as tens of millions of yuan. . After August, with the slight stabilization of cotton and cotton yarn prices, corporate profits have improved, gradually entering a break-even or slightly lossy state. The current average cotton yarn inventory of these textile companies is about 40 days, and in previous years it was generally about 20 days. In the most difficult period of the year, this year also reached cotton yarn inventory of 3 months. At present, there are very few enterprises' cotton stocks, which are generally flow stocks.
Texas companies face financial difficulties. This year's cotton and textile companies ** are difficult, generally from commercial banks and rural credit cooperatives, **, interest rates are high, generally reached about 1 point. Some textile companies also borrowed more than one point from private loans.
From March to July this year, 80% of textile enterprises in Texas stopped production. After August, some companies resumed their work. However, due to rising labor costs, the operating rate of enterprises is generally around 80%. The average wage of local workers has risen from 1,500 yuan per month last year to 1,900 yuan this year. Even so, companies still have insufficient recruitment.
Enterprises should be the same amount of hedging The surveyed unit generally believes that the country’s unlimited storage plan and future progress will have an important impact on cotton spot prices and prices.
From now on, as long as the spot market price of cotton is not significantly lower than 19,800 yuan/ton, processing companies will give priority to sales in the spot market rather than to national reserves. The main reason is that cotton companies need at least 25 working days from the acquisition price to the transportation to the warehouse, through various links. Under the same price, the company sells in the spot market, and the return capital is more rapid and the turnover rate is high. Similarly, ** delivery is relatively more stringent, and only when the price of ** is significantly higher than the national purchase and storage price, the company considers registering the warehouse receipt in the ** market and sells it. Therefore, for some time in the future, the upper limit of the market price may be around 20,800 yuan/ton.
On the other hand, this year, the attitude of state purchasing and storage is relatively clear. In addition to the current 89.40 million tons of additional tariffs that the country has already issued, the issuance of slip-tax quotas will be more cautious. In this way, the price of cotton in the international market has a relatively limited impact on domestic prices. Once the spot market price and the price of ** are far lower than the country's 19,800 yuan / ton, the company will purchase a large amount of cotton in the spot market and send it to the national reserve. At present, the country can accommodate a cotton reserve of about 3 million tons. Although the actual reserves this year do not necessarily reach this figure, it will still provide support for cotton prices. Therefore, we believe that the lower limit of the price of cotton in the future may be around 18,800 yuan/ton.
Therefore, the current basic strategy of processing companies should be equal amount of hedging. In the spot market, reference is made to the state purchasing and storage price to purchase seed cotton, and at the same time, the same number of empty orders are established in the ** market. In the future, when the price rises, the seller will sell the lint, and will close the position with a short position. If the price falls, the lint will be sold at a loss, but the short position will be profitable. In order to ensure the balanced operation of the two markets, companies need to check the position of the ** market and the spot market every day.
