Domestic cotton cost advantage to help prices back back
Recently, the black varieties of commodity futures, represented by a black whirlwind in the capital market. However, with the market push, some market participants have put the eye finished focus on the star variety in 2011 - cotton. In just nine trading days to recover nearly 10 months of lost ground, has rebounded to the level of late May last year. Cotton futures rose strongly, can be said to be the king back.
According to the reporter understands, cotton futures appeared rare surge market, is due to the short-term cotton supply and demand relationship has changed, the market is currently in a state of high quality cotton supply exceeds demand. As of April 21, cotton futures main 1609 contract prices for nine trading days has risen nearly 3,000 yuan / ton, or 25.87%. 21, Zheng cotton futures main contract 1609 opened 12,400 yuan / ton, closing 13355 yuan / ton, an intra-day increase of 6.46%, futures prices repeatedly close to stop. In the futures market, driven by the spot market is also "up" sound.
Imported cotton price advantage faded
Recently, the much-anticipated market rotation of national cotton reserves, the rotation into the rules landed. "Announcement on the national reserve cotton rotation arrangements" clearly indicates that the 2015/16 dumping time for May 3 - August 31, the total rotation of no more than 2 million tons, the rotation of reserve cotton by the China Fiber Inspection Bureau to organize a full range of quality and weight notarized inspection.
"On the national reserve cotton rotation announcement, in mid-March cotton futures annual meeting has been known to the market, and now the policy announcement is only a confirmation of the previous market speculation, short-term reserve cotton rotation to increase supply pressure of the negative has basically been digested by the market. In the long run, the inventory pressure is relieved, and the impact on prices is neutral preference." Myke futures research manager Liu Yi said in an interview with the "Huaxia Times" reporter.
Liu Yi said, from the futures plate, now cotton futures upward momentum is very strong, in addition to the funds to promote, downstream spinning enterprises to take the initiative to replenish the warehouse also to promote prices. "More rotation, less rotation into" and "national reserves of foreign cotton priority rotation, storage time of cotton priority rotation" these two principles are also fully in line with the expectations of the market parties.
Some foreign investors use "stable, accurate, hard" to describe the national cotton reserves rotation, especially the rotation price with CotlookA (actually ICE futures) index "bundled" and adjusted once a week, really realize the internal and external cotton price linkage, linkage, joint The cotton price is stable, which is conducive to maintaining cotton prices, improve the competitiveness of cotton textile exports and China's cotton industry "market-oriented".
"According to the policy announced by the state, has determined the pricing of the national reserves, the adoption of the CotlookA (actually ICE futures) index and the arithmetic average of the domestic spot price index of 50% each, adjusted once a week. 2015/16 rotation time is May 3, then the rotation price that is a reference to the April 25-29 The domestic and international prices on April 25-29 cannot be calculated yet." Liu Yi said in an interview with the "China Times" reporter.
On the calculation of the dumping price, China Merchants Futures Shanghai Century Avenue business department general manager Yang Zhijiang said, for investors, more than accounting for the dumping price finished amount not to do more (dumping price is a floating price). According to the current domestic and foreign spot price conditions, the domestic reach 12,200 yuan / ton or more, the competitive advantage will gradually lose, static inference 12,200 yuan may have pressure.
According to the General Administration of Customs of China, in March 2016, China imported 57,900 tons of cotton, an increase of 0.17 million tons, or 2.97%; a decrease of 70,000 tons, or 54.73%, compared with the same period last year. From September 2015 to March 2016, China imported a total of 575,400 tons of cotton, a decrease of 434,200 tons or 43.01% year-on-year. from January to March 2016, China imported a total of 209,700 tons of cotton, a decrease of 238,500 tons or 53.21% year-on-year.
"From a fundamental point of view, China's cotton production is decreasing, the reserve cotton out of storage has become normalized, the supply side pressure weakened. Domestic prices are falling, and the price advantage of imported cotton is also fading. Spinning yarn, imported yarn in addition to combed yarn still have a small profit, other cotton yarn prices have been inverted, and chemical fiber prices are also rising, so the impact of substitution weakened. Thus, it seems that the domestic cotton competitiveness, the supply pattern began to change, so you can be cautious to see more cotton." Liu Yi analysis to reporters.
Spinning enterprises need to be cautious in procurement
April 15, the state reserves of cotton rotation policy boots on the ground, rotation price dynamic adjustment with the market, which undoubtedly gave the market a pill of certainty. However, due to the decline in the quality of new cotton, imported cotton is limited, so the market demand for high-grade cotton is relatively strong. At present, the State Reserve's cotton storage time are in 2-3 years, the quality grade can not reach 3 grade.
And this at the same time, the market is not short of low-priced cotton, so the priority rotation of imported cotton, is in line with market demand. Industry insiders believe that the current corporate inventory is not high, the downstream off-season, the late replenishment demand exists, but will not be released for a short time. Therefore, it is not recommended that downstream enterprises to increase the purchase volume.
It is understood that, due to the continuation of China's cotton prices in 2011, and a record high, resulting in a greater cost advantage of imported cotton, and then, the world economic downturn, limited consumption, inventory backlog, cotton prices continue to fall back. However, in 2016, Chinese cotton prices and imported cotton prices close, import profits shrink, coupled with a domestic production and marketing gap, began to consume domestic stocks.
In recent years, as cotton prices continue to record low, who has a large inventory who loses money, so many companies have kept their inventories low, which has led to a severe shortage of inventory in the current industry chain. In the medium to long term, the industry is now generally expected to reserve cotton to stockpile the rhythm of only 2 million tons or less, the amount placed is very small, the impact on prices is not great.
"From the historical trend of cotton prices, the beginning of the year below 10,000 yuan / ton has been in the low price range since nearly a decade, high inventory, low consumption, high substitution is the main basis for lower prices and strategies to short. But a sun to change the three views, the fundamentals of the moment to transform, the ratio of low, macro-expected to be good can bring upward rebound. But the continuous surge on the market, the industry formed a lot of damage, there have been entity enterprises reflect can not deduce the future trend, hedging does not dare, production arrangements can only maintain caution." Yongan Futures Research Institute Vice President Ren Xinpu said in an interview with the "Huaxia Times" reporter.
Ren Xinpu said, this strong rebound may not be the signal of the spot cotton price increase, the production of fabric enterprises or in accordance with their own product structure and market demand to arrange. It is recommended to pay attention to the State Reserve imported cotton origin, batch, quality indicators and storage locations, good trading market inspection, transportation and other related work. Orders are the basis, price, quality is the key, impulsiveness is the scourge.
Ren Xinpu pointed out that half a month ago in the fabric enterprises in Jiangsu and Zhejiang areas research learned that the number of orders vary high and low, the start-up rate of large enterprises, differential enterprises a little higher, conventional yarn enterprises a little lower; color spinning yarn a little better, white yarn a little worse; high count yarn a little better, low count yarn a little worse. In terms of enterprise efficiency, pure cotton textile, low count yarn, conventional varieties of performance is a little worse; high count yarn, color spinning yarn is a little better.
Based on the expected decline in cotton prices, raw materials, spinning yarn inventory is generally not high, for the market, and then up is about the same. Futures prices reflect expectations, but on the current situation inside and outside the fabric industry, as well as cotton consumption and cotton substitution, demand does not yet support cotton prices raw materials rose sharply.
For the post-market price trend of cotton, Liu Yi said, at present, small enterprises have closed down a lot, surviving are holding a certain market share. Now is the consumer off-season, the end demand is not completely up, there is still a demand for procurement later. In the long run, the supply pressure is reduced, spinning yarn and chemical fiber substitution is also weakening, the previous negative factors are gradually reduced, the fundamental pattern has changed, so the long-term view of cotton prices below the space is limited. Short-term constraints on the price of space above the factors, depending on the enterprise of the State Reserve cotton rotation to buy strength.
Contact: Jeanne yang（MISS）
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