Domestic And Foreign Cotton Price Differential Reduction Cotton Industry Ready

Since the beginning of this year, international cotton prices have gone up all the way. cotton The price difference narrowed to 2305 yuan / ton, and the price difference between China and the United States was close to the relatively low level since 2012. Analysts pointed out that the global 2013/2014 cotton planting area determined to decline, the domestic and foreign cotton price differential further narrowed is expected to be strong, multiple positive effects, the domestic cotton industry chain is expected to "comprehensive boost", the competitiveness of upstream and downstream enterprises will gradually recover.

Inside and outside cotton price differential reduction

The price of cotton in the international market continued to rise, thanks to the news of reduced cotton planting area in the United States and the increase in the volume of US cotton exports. The 18 day ICE cotton contract in May hit a record high of 92.5 cents / pound.

Under the support of purchasing and storage policy, the domestic cotton market is running smoothly. Zhengzhou cotton futures contract settlement price in March reported 19592 yuan / ton, down 374 yuan / ton from last month. Wei Qiao textile Zhang Hongxia said that this year the state released cotton reserves to stabilize prices, coupled with rising international cotton prices, the future price difference or further narrowing.

Analysts pointed out that the current domestic and foreign cotton prices narrowed, close to the relatively low level since last year, if some cotton textile enterprises can expect to get more import quotas, the cost of comprehensive raw materials will not be much different from those of international competitors.

Jinqiao textile net news, in February, the import price of China's main port of import cotton was calculated to be 14776 yuan / ton at 1% customs duties, up 735 yuan / ton from last month, or 5.2%, and 15502 yuan / ton according to "sliding tax", up 576 yuan per ton, or 3.9%.

In the global 2013/2014, the cotton planting area has definitely declined, while more than half of the higher inventory is in the hands of China's national reserve. In view of the larger shrinkage probability of cotton prices in the future, the negative factors that will affect the global competitiveness of China's cotton textile industry will be weakened.

Increased willingness to replenishment

The latest cotton supply and demand report released by the US Department of agriculture has reduced global cotton inventories to 76.3% for the first time. According to statistics, in February cotton spinning The inventory of cotton in the warehouse is 759 thousand and 800 tons, and the decrease is more obvious. Analysts pointed out that the data reflected from the side that the willingness of the global textile mills to replenishment in the near future is increasing, and this trend has also become the main driving force for the recent increase in the price of foreign cotton.

It is reported that the relevant departments will issue temporary quotas for cotton processing trade temporarily to meet market demand, and the quota will be about 70-80 tons. However, the nature of the quotas is "processing trade" rather than "quasi tax" quota, which has limited impact on domestic cotton prices. The national development and Reform Commission said earlier that cotton import quotas in 2013 amounted to 894 thousand tons.

However, China is the biggest cotton consuming country in the world. Although the quota of processing trade quotas on cotton imports has limited impact on domestic cotton prices, it will boost the price of American cotton to a certain extent, and domestic export textile enterprises will get breathing space.

Textile enterprises export business improvement

As domestic and foreign cotton spreads narrowed further, Spin The recovery of export trade exceeded expectations. According to the latest data from the General Administration of customs, China's textile and apparel exports totaled 41 billion 170 million US dollars in 1-2 months in 2013, up 31.8% over the same period last year. Among them, the export volume of domestic textiles in February was 5 billion 890 million US dollars, up 38.08% over the same period last year, far exceeding market expectations.

Guotai Junan's latest analysis pointed out that in recent months, the economic situation of European countries has not deteriorated further. The latest PMI index released by Europe and the United States has reached a new high in recent years, and American consumers are optimistic about the future economic situation. At the same time, Japan's GDP ratio is flat, and the economy is gradually getting rid of recession. Guotai Junan believes that China's good export performance in 1 and February is not a flash in the pan, and it is expected that the export market will pick up again.

Huatai Securities (601688) analysis put forward reservations that the export growth in 1 and February was not sustainable, and the US textile industry could only maintain a modest growth in the background of moderate or mild recovery.