According to feedback from some cotton textile companies in Shandong, Jiangsu, Henan and other places, the operating rates of yarn mills and weaving companies have rebounded recently. In particular, the rebound momentum of companies with OE yarn and low-count ring spinning as their leading products is relatively obvious. Some cotton yarns have been tired. Spinners with low inventory rates and sufficient capital chains tentatively and slightly raised their quotations for OE yarns and 40S and above ring spinning yarns.
According to industry analysis, supported by the replenishment of orders for medium-thick fabrics in the domestic sales market in the autumn and winter of 2022, it will benefit the consumption of coarse-count yarns. As the typhoon passed through, the temperature dropped in Jiangsu, Zhejiang, Guangdong, Fujian and other places. The “alarm” of power and production restrictions in various regions was lifted. Foreign trade companies, clothing and weaving enterprises gradually resumed receiving orders, and the demand for cotton yarn rebounded in stages. In addition, in August, some small and medium-sized yarn mills launched a small amount of low-price and special price cotton yarn promotions in order to mobilize funds and speed up “destocking”, and the results were reflected.
Judging from the survey, the Zheng Cotton CF2301 contract price has continued to consolidate in the range of 14,800-15,300 yuan/ton since late August. The current daily fluctuations of cotton futures have significantly weakened. Cotton-using companies have a negative attitude towards cotton, polyester staple fiber, viscose staple fiber, etc. The procurement of raw materials is also more active than in June and July. A medium-sized cotton spinning mill in Xuzhou, Jiangsu Province said that in addition to the rebound in cotton yarn and gray fabric transactions (the operating rate of circular knitting machines in coastal areas has bottomed out, and the “volume and price” of knitted yarn have increased), textile companies are trying to increase yarn prices. In addition to the recovery of cotton yarn and gray fabric transactions, they also have foreign yarn arriving at China’s main port. This is related to the sharp decline in quantity (some cotton yarn traders estimate that the volume of imported yarn arriving at Hong Kong in July fell by nearly 40% compared with June). The current focus of textile companies is the impact of weather on Xinjiang’s cotton areas and the demand for winter and spring clothing from Europe and the United States during the “Double Festival” and domestic sales.
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