Most people have seen the astonishing rise in cotton yarn after January this year, but few expected that the cotton yarn situation had subsided for a period of time before the Spring Festival. Prices will be like a wild horse running wild after the holidays, unable to be pulled back. As of February 25, 2021, CY C32S pure cotton yarn closed at 25,450 yuan/ton, an increase of 1,455 yuan/ton in just one week, an increase of more than 6%.
After the Spring Festival, Zheng Mian’s main CF2105 contract is in crude oil, energy, chemicals, heavy metals and other commodity futures and 2021 global The fanatical expectations for a retaliatory rebound in the economy, trade, textile and clothing consumption, etc., have broken through the 16000, 16200, 16500 and other whole levels like a bamboo. It seems that the 10,000-7 mark is about to be stepped on. However, the increase in downstream cotton yarn is even greater. The ex-factory price of cotton yarn is “adjusted once a day or even twice a day”, and spinning profits have increased compared with the fourth quarter of 2020. This is mainly caused by low cotton yarn inventories in cotton spinning mills, sufficient liquidity, and surges in crude oil, chemical sources, and chemicals. Increased inflation and other effects. As of February 25, the spot profits of textile companies were at 1,500 yuan/ton, and the lives of textile companies were relatively “moist”.
Judging from the cotton yarn quotations of textile companies, the prices of various types of cotton yarn are now significantly increased by 1500~2000 compared with before the Spring Festival. Yuan / ton. Cotton spinning mills are full of confidence in their production and operations this year, and post-holiday purchases and sales are quickly on track. In terms of construction start-up, the holiday period for textile companies before the year of 2021 will be postponed, and the start-up will be advanced after the new year, and the start-up recovery will be faster. According to the lunar calendar, the start-up rate on the eighth day after the holiday is nearly 10 percentage points higher than that in 2018 and 2019. Yarn inventory is significantly lower than in previous years. As of February 25, China’s yarn inventory index closed at 9.2 days. If the peak season in March-April arrives as expected, textile companies will continue to be in short supply. According to the investigation, most textile companies are currently actively completing pre-holiday lint purchase contracts and organizing lint storage into warehouses to prevent upstream ginners and traders from breaking contracts due to the skyrocketing cotton prices; at the same time, they are appropriately purchasing lint that is urgently needed for cotton distribution. In terms of cotton yarn sales and shipments, we promptly adjusted the idea of rushing out pre-holiday orders after the holidays and shipping them in time to complete the contract. Instead, we completed the pre-holiday orders in stages, giving priority to the supply of cotton yarn purchased at high prices after the holidays and actively shipping them. Many textile company bosses believe that “there is wine now and drunkenness tomorrow”. At present, they should run at full capacity, seize the opportunity to produce and sell, and strive to complete 70% or even higher of the 2021 annual profit target and production tasks in the first half of the year.
Downstream weaving factories are fully operational this week. As of February 25, China’s gray fabric load index has soared from 24.3% on the 19th to 57.5%, more than doubling. In terms of price, CG C32 full gray fabric has also risen to 6 yuan/meter, an increase of 9.29% compared with 5.49 yuan/meter on the 19th. However, compared with the upstream cotton yarn that surged by more than 10% in February, the current price increases of gray cloth, fabrics, clothing, etc. are significantly lagging behind. Export-oriented companies and processing companies are becoming more cautious in accepting orders. Whether they can withstand and digest the rising costs remains to be seen. Break-in. On the other hand, the U.S. government continues to impose additional tariffs on US$370 billion of imported Chinese goods and continues to implement an import ban on Xinjiang cotton products. Brands and retailers in Europe and the United States have limited increases in unit prices for textile and clothing purchases and even do not agree to increase them. As a direct result Either foreign orders will continue to be transferred to Southeast Asian countries; or Chinese companies will accept orders with low profits, no profits or even losses. At present, the mentality of weaving mills is still cautious, believing that without demand support, even if raw materials help to increase, it will not be able to form a sustainable market. However, as long as upstream cotton yarn remains in short supply, coupled with expectations for an improvement in the epidemic, it is unlikely that the gray fabric market will experience a unilateral decline in the first half of this year. The fluctuation of cotton prices is normal market behavior. As long as the amplitude is relatively controllable, there is no need to deliberately reduce production. , therefore the factory capital chain may affect the factory start-up load in the first half of 2021. The inventory of factories with sufficient funds may increase slightly, while factories with tight funds will pay more attention to the production and sales ratio.
In summary, the power of this surge in raw materials is not the fundamentals of supply and demand, but funding and speculation intensity. Judging from a series of recent actions by the central bank, expectations for “ultra-loose” monetary policy and large-scale water release in 2021 have been significantly weakened (mainly due to the overall stabilization and recovery of my country’s economy, and current inflationary pressure is prominent), and steady or even phased tightening has become the main tone. . The trend of Sino-US relations is not clear. No matter whether Trump or Biden comes to power, suppressing China will always be the core of the United States. The Biden administration has even formed a tough China working group. On the other hand, although the number of new cases of COVID-19 in Europe has generally decreased and the number of people vaccinated has increased, mutant COVID-19 viruses are spreading rapidly in many places, and the rise in infection rates is worrying. Therefore, textile and apparel consumer demand may enter stagflation after a retaliatory rebound in the fourth quarter of 2020.�. When all the money ebbs, it will be clear who is “swimming naked.”
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