Zheng cotton futures reached a high point on October 19 and turned downward on October 20. The pure cotton yarn market subsequently cooled down and cotton yarn prices gradually fell back. As of November 12, CY C32S pure cotton yarn closed at 21,160 yuan/ton, a drop of 1,340 yuan, or 5.96%, from the highest point of 22,500 yuan/ton on October 19.
At present, the acquisition of machine-picked seed cotton in southern Xinjiang has come to an end, and the cost of new cotton in 20/21 is basically determined. As of November 12, the CC3128B cotton index closed at 14,501 yuan/ton, down 92 yuan/ton from the same period last week. The cost of most new cotton in northern Xinjiang is in the range of 13,800-14,200, while the cost of machine-picked new cotton in a small part of northern Xinjiang and most of southern Xinjiang is close to 15,000 or even slightly above, so the supporting role of new cotton cost is still strong. However, downstream textile companies have received fewer new orders in the later period, but the inventory of finished products is still not high. Most of them are within half a month. The pressure on the industry still needs to continue to accumulate to be highlighted. However, currently textile companies are unwilling to accumulate due to pessimistic expectations. Inventory, the current industrial buying drive is weaker than the previous period.
For half a month since mid-to-late October, cotton yarn futures prices have fallen all the way from 22260 to 20630 points, falling Reached 1630 points, a decrease of 7.32%. The sharp drop in futures prices has had a serious impact on spot sales of cotton yarn. However, starting from Monday this week, cotton yarn futures reversed their decline and continued to rebound. This has caused many textile companies to change their previous downward trend and show strong quotations. However, based on the calculation of the 20-day production cycle, the current profits of textile companies have been lost by more than 800 yuan/ton, and the enthusiasm of textile companies is not high, not to mention the scarcity of later orders. The startup load that experienced a surge in the early stage is now also There has been a decline.
On the downstream side, cotton gray fabrics remain stable but weak despite the price drop of cotton and cotton yarn, mainly due to Cost support, but the wait-and-see mentality of downstream companies, coupled with factors such as the own off-season, has reduced orders and increased inventory pressure. As of the 12th, China’s gray fabric inventory index closed at 21.5 days, almost double compared to 12.8 days of yarn inventory. It is expected that the market demand for gray fabrics will remain weak in the future, the order situation will not improve much, and the inventory of weaving mills will continue to increase. As the year is approaching, the work of weaving mills to withdraw funds may start in advance, and the phenomenon of selling goods is expected to occur.
In mid-to-early October, the price of imported yarn rose sharply in the internal and external market, and the atmosphere gradually faded in the second half of October. Prices began to loosen and fall. A comprehensive assessment showed that the inventory of imported yarn ports in October first dropped sharply and then slowly increased. The comprehensive inventory of imported yarn was at a relatively low level. As of November 6, the inventory of imported yarn rose to 78,000 tons. On the other hand, various parties have different opinions on the impact of the election of a new president on the future commodity market. First of all, Biden has made it clear that his future political focus will be on controlling the epidemic and restoring the U.S. economy under control as soon as possible. Therefore, he is not expected to make any major moves on the international trade market in the short term. In the short term, the most obvious change is the exchange rate. On the 10th of this week, the central parity rate of the RMB exchange rate once rose above 6.6, and the exchange rate issue is directly related to the foreign exchange settlement cost of imported yarn. According to calculations, if the external price remains unchanged, the exchange rate settlement cost will drop by 200-400 yuan/ton compared with the end of October. In the short to medium term, the political and economic factors in the United States are not yet stable, and the exchange rate is difficult to predict accurately. Now, if Biden is elected as the President of the United States, it may give the U.S. economy a shot in the arm and trigger a rebound in the exchange rate. However, judging from Trump’s various operations in recent days, there will still be some unstable factors in the future, but the accurate official announcement time is January 6 next year. The exchange rate is expected to remain stable until then. </p