This week, domestic cotton prices fluctuated within a narrow range, while foreign cotton prices corrected and consolidated; domestic and foreign cotton yarn prices remained stable; polyester staple fiber prices fluctuated.
1. Domestic cotton prices fluctuate within a narrow range
This week, sufficient cotton supply continues to put pressure on the market. The U.S. ban on imports of Xinjiang cotton has made the market Pessimism has increased and domestic cotton prices have weakened. From November 30 to December 4, 2020, the settlement price of the main cotton futures contract in Zhengzhou was 14,436 yuan/ton, a decrease of 16 yuan/ton or 0.1% from the previous week; the national cotton price B index represents the market price of standard grade lint cotton in the mainland. The average price was 14,391 yuan/ton, up 1 yuan/ton from the previous week. The average price of China’s cotton purchase price S index, which represents the average price of white cotton grade 3 seed cotton and lint cotton in the country’s main cotton-producing provinces (districts), is 12,867 yuan/ton (excluding processing fees), an increase of 80 yuan/ton or 0.6% from the previous week. .
2. International cotton prices corrected and consolidated
This week, the grain market was generally weak. Pfizer cut its COVID-19 vaccine production target by half, triggering international cotton prices. fell. From November 30 to December 4, 2020, the settlement price of the main New York cotton futures contract was 71.76 cents/pound, a decrease of 1.34 cents/pound or 1.8% from the previous week; representing the average CIF price of imported cotton at China’s main port The average price of the International Cotton Index (M) is 80.89 cents/pound, down 0.61 cents/pound or 0.7% from the previous week, and the import cost in RMB is 13,336 yuan/ton (calculated based on 1% tariff, including port miscellaneous goods and freight). It fell by 274 yuan/ton compared with the previous week. The international cotton price was 1,059 yuan/ton lower than the domestic cotton price. The price difference between domestic and foreign prices expanded by 278 yuan/ton compared with last week.
3. Domestic spot yarn prices remain stable, futures prices rise and fall, and international yarn prices are stable
This week, the domestic textile market as a whole continues to be weak. Terminal foreign trade orders have declined due to the rise in the RMB exchange rate, and the profits of textile and clothing companies have further shrunk. Domestic cotton yarn prices have remained stable; overseas terminal demand has been poor due to the epidemic blockade, and the cotton yarn market continues to cool down; imported yarn profits have increased slightly, and part of the profits come from The exchange rate has appreciated, but due to the shortage of containers, shipments have been delayed, shipping prices are still high, and the price difference between domestic and foreign yarns continues to be inverted. The average price of conventional foreign yarns is 148 yuan/ton higher than that of domestic yarns. The extent of the inversion has been reduced due to exchange rate changes; gray fabrics The market continues to be sluggish and prices are relatively stable; polyester staple fiber prices fluctuate following the trend of PTA.
Four. Market Outlook
On the eve of the dawn of vaccination, the international Cotton prices are relatively resilient. Overseas vaccines have entered the delivery cycle, and Britain and Russia will begin mass vaccination next week. After being 95% effective, the COVID-19 vaccine has once again announced that it is 100% effective in preventing severe disease. The global COVID-19 epidemic is expected to subside faster again. U.S. stocks were stronger. The U.S. dollar index fell below 91, hitting a new low since April 2018. Optimistic expectations for U.S. fiscal stimulus policy continue to rise. In terms of the international cotton market, ICAC’s December global production demand forecast report reduced the 2020/21 cotton production to 24.68 million tons from November, a year-on-year decrease of 5.3%. The consumption of 24.26 million tons was unchanged from the previous month, a year-on-year increase of 7.6%. The northern hemisphere is in the period of intensive launch of new cotton, and the harvest progress of US cotton is nearly 90%; the price of Indian seed cotton has increased by 25% in two months, prompting cotton farmers to harvest and sell in large quantities. The launch time of new cotton has been advanced, and the cumulative market volume has increased by 10% year-on-year; US cotton Cotton from China and India has arrived in Hong Kong one after another. The number of U.S. cotton export contracts decreased slightly this week, while China’s procurement volume increased. The order situation in the international cotton yarn market is not optimistic. Christmas orders and replenishment orders have basically been completed. Raw material inventories in major textile and clothing production countries are at a relatively low level. Most companies and traders are in the stage of destocking and realizing cash. The market is sensitive to the outlook for global trade, and the vaccination situation next week may bring volatility to the short-term market trend.
The country continues to release positive signals, and the cotton spinning market is operating smoothly. The National Bureau of Statistics’ manufacturing purchasing managers’ index (PMI) in November was 52.1%, an increase of 0.7% month-on-month. It has been above the critical point for nine consecutive months. The restorative growth of the manufacturing industry has accelerated. The central bank distributed 200 billion MLF and 150 billion reverse repurchases to maintain market liquidity, and the financial situation became increasingly warm. 600 million doses of domestically produced inactivated COVID-19 vaccines will be approved for marketing within the year. In the domestic cotton market, supply pressure continues to increase. During the centralized marketing stage of new cotton, the cooling and snowfall in some cotton areas in Xinjiang have limited impact on cotton procurement and processing. According to data from the National Cotton Market Monitoring System, as of December 4, the cumulative sales of new cotton nationwide were 1.486 million. tons, an increase of 268,000 tons year-on-year; supported by high cost factors and vaccine optimism, ginneries are more willing to sell at higher prices. The phenomenon of downstream load reduction and production suspension continues. As the end of the year approaches, the order receiving situation of enterprises is relatively stable. Some enterprises are preparing small batches of raw materials for next spring and summer orders. Traders also report that inquiries have increased in recent days. Enterprises are generally cautiously optimistic about the market outlook. manner. With the recent rise in the RMB exchange rate, the import volume of foreign yarns has continued to increase, and the competition between domestic and foreign yarns has further emerged. In the short term, optimistic expectations of the external environment support the improvement of the domestic cotton market sentiment, but demand dynamics may limit the room for cotton prices to a certain extent.
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