According to feedback from cotton trading companies in Zhangjiagang, Qingdao, Ningbo and other places, the RMB quotation basis for Indian cotton cargo, bonded and customs clearance has continued to be stable since late January. Although in recent days, as domestic textile companies have been on holiday, the number of raw material inquiries has gradually increased. , procurement has decreased significantly, but the willingness of international cotton merchants and import companies to actively lower the basis is still not strong.
Although cotton-related companies and investors judge that the US$1.9 trillion stimulus plan in the United States is likely to shrink, there is a high probability that the Democratic Party will forcefully promote super QE in the first and second quarters of 2021, and the US stock and commodity futures markets are still There is room for growth; in addition, the increase in domestic cotton and cotton yarn prices in India is relatively smooth, coupled with the MSP purchase price support and the cotton planting area in India in 2021 may decrease due to the switch to soybeans, corn and other crops, so MCX futures and Indian cotton spot prices “Easy to rise, hard to fall.”
From the survey, in recent days, the basis difference of Indian cotton in China’s main ports in February/March is M1-5/32 (strong 29GPT), which is generally 3-3.8 cents/pound, and the fixed price It is stable at 83.5-84.5 cents/pound (strong 28-29GPT), and the price difference with US cotton in the same shipping period is 3.5-5.2 cents/pound. The price competitiveness of Indian cotton cargo and bonded cotton is narrower than that in December/January. . On February 3-4, the “fixed price” of SM1-5/32 Indian customs clearance cotton in Qingdao Port was 15,400-15,600 yuan/ton (it will vary due to different impurities and other indicators. The price quoted in Zhangjiagang is generally slightly higher by 50-100 yuan/ton) ), while the spot price of Brazilian cotton M1-1/8 at the port is 15,800-15,900 yuan/ton, which is 300-500 yuan/ton higher than Indian cotton.
Several textile companies in Jiangsu, Shandong and other places said that although Indian cotton still has some advantages regardless of whether it is quoted in US dollars or RMB, the quality and spinnability of Indian cotton in 2020/21 are still relatively low. Outstanding, Chinese buyers need to be cautious when placing orders. </p