Multiple Factors Push Up Cotton Prices And Downstream Industries Seek Countermeasures

Short month, the cotton market transaction price refreshed the record for 10 years, spread to the cloth market, and also affected the related industries.

Higher cotton prices call for timely regulation

"Two hundred or three hundred autumn and winter clothing, 7/10 up the price." In October 14th, Mr. Chen, a well-known international fashion brand in Hefei Baima Garment City, told reporters that the price of fabrics increased by 8%-12% this year, which directly led to the rise of the prices of finished products in autumn and winter.

"Cotton prices have spread to the garment industry." Shen Aihui, Deputy Secretary General of Anhui clothing trade association, said that cotton is the raw material for spinning and weaving. The rise in cotton prices this year has led to the rise in fabric prices, which has put pressure on garment enterprises. "It is expected that clothing prices will show more clearly next year."

　 Source: seed cotton purchase price rose 62%

"I have worked in the textile industry for a lifetime, and this rally is very rare." The Anhui provincial cotton textile industry association, vice president of the textile industry, told reporters that the entire textile industry is worried about the soaring cotton prices this year. Over the past more than 10 years, the cotton price has been lingering at the price of 15 thousand yuan / ton -1.7 yuan / ton. When the new cotton comes into the market in September, the cotton price should go down, but this year it has soared to 25 thousand yuan / ton, which is rare.

According to China's cotton price index chart, cotton prices have risen sharply in the past month. Cotton prices remained hovering at the price of 17800 yuan / ton in September 10th, and prices surged after that, and by October 8th, it had surged to 24200 yuan / ton, or nearly 36%. According to the latest Chinese cotton price index, in October 12th, the weighted average price of 329 cotton was 23720 yuan / ton, up 293 yuan / ton compared with October 11th, of which 329 cotton price index in Anhui province was 23470 yuan / ton.

Wang Xuanzhong, President of the provincial Cotton Association, told reporters that in 2010, the supply and demand of cotton in the international market were basically balanced. The world's cotton output was 25 million 110 thousand tons, an increase of 3 million 360 thousand tons over the previous year and 25 million 70 thousand tons of consumption, an increase of 470 thousand tons over the previous year. China's cotton production is expected to be 6 million 980 thousand tons, down from last year, and cotton demand will continue to increase and consumption will be 10 million 350 thousand tons. cotton The gap between production and demand expanded to 3 million 370 thousand tons. The cotton planting area in our province is estimated at 5 million 300 thousand mu, an increase over 5 million 160 thousand mu last year. But it is estimated that our province will produce 380 thousand tons of cotton and 420 thousand tons of consumption, and the supply and demand will not be balanced.

According to the data provided by the provincial Cotton Association, Anhui's 4 grade seed cotton is generally. Buy The price has reached 5.3-5.5 yuan / Jin, and last year, the average price of seed cotton purchase was 3.2 yuan / Jin, 2 yuan per catty, or about 62%. "A big increase in the short term." Wang Xuanzhong said that in the past 9 months, cotton came into the market in the middle of last year and was listed in large quantities after the national day. This year, due to low temperature and continuous rainfall, cotton market has been postponed for about 20 days compared with previous years. It is expected that cotton will be listed in large quantities in late October.

Reasons: multiple factors push up cotton prices

"The recent surge in cotton prices is caused by a variety of reasons." Wang Jian Analysis said.

Since September, the domestic and international cotton prices have risen considerably. First, the gap between domestic cotton supply and demand is widening, and the imbalance between supply and demand of cotton is estimated. It is estimated that the domestic demand gap will reach 3 million 370 thousand tons in 2010, and the imbalance between supply and demand of cotton is the fundamental reason for the rise of cotton. Second, the listing of seed cotton has been postponed. Since late August, the main cotton producing areas in China have been raining continuously, which has a greater impact on cotton output and grade, and further pushes up the cotton bullish expectations. Third, the sales of textile industry will turn better and the cotton rising space will be opened. Textile industry recovers, gauze price rises, drive cotton price rise. In addition, Wang Xuanzhong believes that the current surge in cotton prices may be related to speculation. Especially since September, the market of the electronic disk market such as Zheng cotton futures and matchmaking has been on the rise frequently. The futures contract has reached more than about 2000000 hands a day, and its positions have also reached a record.

The Anhui provincial cotton textile industry association strict vice president also thought that the cotton price soaring is the multiple factor. He said that in addition to postponing the listing of new cotton in China, the export situation of major cotton producing areas to China this year is not ideal. For example, India, a big cotton producer, has introduced a series of measures this year to control cotton exports and stimulate cotton prices to rise. In addition, cotton is agricultural products and agricultural futures. It has certain financial attributes, and the speculation of idle funds is its financial attributes.

For the post market analysis of cotton prices, Wang Xuanzhong said that cotton is estimated to be at a high concussion in the near future, but in the long run, according to market rules, sooner or later, it will return to a reasonable price. According to the introduction, according to the industry's calculation, the normal price of grain and cotton is 1:8. According to this calculation, the normal sale price of grade 3 cotton is 17 thousand yuan / ton -1.8 yuan / ton is appropriate, "fluctuation is normal at 20 thousand yuan / ton price", but at present, the price trend has reached 24 thousand yuan -2.5 yuan / ton, which exceeds the normal price level of grain and cotton.

According to Wang Xuanzhong analysis, the state will increase the cotton supply quotas and increase the supply of Xinjiang's cotton to the mainland, and tighten monetary policy and adjust the exchange rate. Therefore, it is suggested that cotton farmers should timely pick and make "four points" work and sell them in a timely manner. He said that it is estimated that the cost of planting cotton is about 3.2 yuan / kg, and the price of seed cotton purchase has risen 2 yuan / Jin this year. There are two risks in cotton farmers' reluctant sale, on the one hand, they must bear the risk of falling market prices. On the other hand, seed cotton flammability and stacking at home will bring hidden dangers.

Impact: downstream industry seeks Countermeasures

The surge in cotton prices has brought heavy pressure to downstream industries. "The cost of cotton accounts for more than 70% of the total cost of textile enterprises, and the price has skyrocketed by 10 thousand yuan / ton, which is really overwhelming." A head of a cotton spinning enterprise in the province said that for the weak and thin enterprises, to deal with this grim situation, we must start with adjusting the product mix structure and emphasizing the internal management of the enterprises. "Raw materials procurement, the use of chemical fiber, less cotton." But he is still worried. Wages and water and electricity prices are rising. Cotton prices have gone up again. "The business life in the second half of this year will be very difficult."

Some small and medium-sized enterprises appear to be somewhat weak in response to the rise in cotton prices. Mr. Zhang, head of a knitting factory in Feidong, Hefei, mainly produces cotton padded cotton pants, thermal underwear and shirt, said that the price of cotton yarn has increased by more than 50% compared with last year, and sales price has not been raised, but sales volume has dropped 1/3. Reporters asked how to deal with the impact of rising cotton prices, he looked very helpless, "can only rely on the state to introduce industry protection measures, from the source to curb the price rise."

The rise in cotton prices has spread to the fabric market and affects related industries. Xia Zong, the head of a leading enterprise in feather industry, told reporters that the price of down, fabric and cloth is rising, which has great impact on the cost of the enterprise.

According to a data provided by Anhui cotton textile industry association, as of August this year, more than 1474 enterprises in Anhui textile industry were above Designated Size, 1/3 of them were export enterprises. In the 1-8 month of this year, our province's textile industry achieved 48 billion yuan in total industrial output value, and the value of export delivery reached 8 billion 800 million yuan. According to the relevant person in charge of the association, although the data show that the contribution rate of textile enterprises to Anhui's industrial GDP is around 4%, the number of employees in the textile industry accounts for 13%-14% of the total number of industrial workers. "The textile industry has solved many people's employment problems. If the textile enterprises fail to go on, it will be related to the livelihood of many people and social stability." He said.