Xinjiang cotton enterprises..


According to the survey, since the mid-August, the contract price of Zhengzhou has oscillated down, the funds of cotton-related enterprises have tightened, and the weather in Xinjiang cotton area in July/August has affected the overall price of Xinjiang cotton in Xinjiang and overseas warehouses by 200-300 yuan/ton. At present, the seed cotton market is expected to be ahead of previous years, and the total cotton output is expected to be flat or slightly higher.

August 16-17, Henan, Shandong, Jiangsu and other mainland libraries 3129B machine cotton (breaking specific strength 28-29CN/TEX) public price quoted 16400-16600 yuan / ton; 3128/2128 (fracture ratio strength 26.5-27.5CN / Tex) Nanjiang hand cotton mining price of 16050-16200 yuan / ton; 3128/2128 (breaking specific strength 25-26CN / Tex) hand cotton mining price of 15700-15900 yuan / ton.

Several traders have reported that the amount of cotton resources in Xinjiang has been significantly reduced by the recent reserve cotton rotation, and the selection of high-quality cotton for bonded and spot-loading is narrower (except for a small amount of US cotton exported to Australia, Australian cotton, Indian cotton). The spot performance was unsatisfactory. Although the cotton “basis price quote” fell with the main contract of Zhengzhou, the enthusiasm of domestic textile enterprises and middlemen for inquiry, purchase and delivery was not high.

On August 14-16, the daily turnover rate of cotton in the reserve cotton was only 59.8%, 54.81%, and 48.76% (compared significantly from March to July of 2018), indicating the terminal of foreign trade companies, clothing enterprises, cotton textile factories, etc. The sluggish production and sales link has caused textile companies to worry more and actively reduce their participation in reserve cotton auctions. With the new footsteps of 2018/19 new cotton market getting closer and closer, most mainland cotton traders and small and medium-sized textile enterprises have basically suspended the inquiry and delivery of the supervision warehouse in Xinjiang. The whole spot market has fallen into a calm and stalemate situation.

According to the national cotton market monitoring system survey, as of August 10, the country's cumulative sales of lint cotton was 5.539 million tons, an increase of 615,000 tons compared with the same period of last year, of which Xinjiang sold 4.419 million tons. According to the national total of 6.127 million tons in 2017/18, there are still 588,000 tons of cotton unsold, of which Xinjiang has about 400,000 tons of cotton. According to the statistics of the China Cotton Association Logistics Branch, as of the end of June 2018, the total amount of cotton turnover in China was about 1.861 million tons, an increase of 940,100 tons compared with the same period (the total amount of commodity cotton turnover in the country at the end of June 2017 was about 920,900 tons). The year-on-year increase was 102.08%.

From the recent 2017/18 annual Xinjiang cotton road transport statistics released by the national cotton trading market, it is slightly lower than 2016/17, and the railway transportation is basically the same as 2016/17. Considering that the total cotton production in Xinjiang in 2017/18 may reach 5.05 million tons (accumulated processing of 5.013 million tons and cumulative public inspection of 510,800 tons), it will increase by nearly 1 million tons from the previous year. Combined with the above three sets of data, the author judged that before the middle of August, the cotton stocks in the various regulatory warehouses in Xinjiang were still more than 1 million tons, but more than 40-50 million tons were sold but not shipped out.

From the survey, the decline in Zheng period since August is significantly higher than that of spot (CF1901 contract fell from 17,555 yuan / ton to a minimum of 16,220 yuan / ton, down 1335 points, while the spot only dropped 200-300 yuan / ton), hedging The ginning factory and the trading factory adopt the operation of “flat air, running spot” to maximize profits. Without the hedging, the cotton enterprises that gambling on the spot of cotton are in a difficult situation. According to the spot market price since mid-August in August, the loss space of cotton picking in southern Xinjiang is generally 600-800 yuan/ton (the loss of individual enterprises exceeds 1000 yuan / ton), and the phenomenon of textile enterprises and traders owing more than the previous period, the "buyer market" formed.

In addition, the pressure on capital flows continued to rise in August and September. First of all, the agricultural issuance loan requires “double settlement zero” before the end of August, and “first repaying the loan” is the industry rule. Secondly, the new cotton open scale in 2018/19 is expected to be concentrated in the middle of September, which is needed for the ginning factory. Prepare sufficient loan guarantees and own acquisition funds (generally 20%-30%); again, Xinjiang “environmental pollution control” has increased, and some areas require boilers, dryers and other equipment “coal to gas” for processing workshops. Dust pollution should be treated in all directions. Otherwise, it is not allowed to start production. It requires not only a certain amount of capital investment, but also a long construction and acceptance period.