As the market price of Zheng Cotton CF2109 contract broke through 17200, 17500, 17800 and other levels, the spot basis quotation, spot price and fixed price increased significantly. However, except for the fixed price cotton, the increase was slow and low. In addition to relatively active transactions, most cotton spinning companies are stuck in a wait-and-see and waiting state. They do not buy into the surge in cotton futures and are not in a strong mood to chase the increase.
A cotton company in Heze, Shandong Province said that although the spot transactions and shipments of commercial cotton since mid-to-late July have not been ideal, cotton spinning mills, middlemen and other customers have paid more attention to Zheng Cotton warehouse receipts However, the enthusiasm for getting goods has increased significantly compared with June, especially warehouse receipts from mainland warehouses are very popular. On the one hand, the price difference between cotton prices inside and outside Xinjiang has narrowed to 150-250 yuan/ton in the past half month; on the other hand, buyers are worried that the color grade and quality indicators of the lint cotton delivered in Xinjiang will not meet the requirements (the discount is high). According to statistics, as of July 28, there were 13,808 Zheng cotton warehouse receipts, a decrease of 3,006 from June 28. In just one month, the outflow of warehouse receipts exceeded 120,000 tons.
From the survey, there are several reasons why cotton textile companies are not active in spot purchasing: First, although Zheng Cotton and Zheng Cotton Yarn started a violent short squeeze mode this week, The actual adjustment space and increase rate of cotton yarn spot are obviously weaker than that of CY2109, and the net profits of cotton spinning mills have continued to decline compared with the previous period; secondly, the cotton reserves are being rotated out in an orderly manner to support cotton spinning mills, and the demand for raw material procurement is guaranteed. According to the 600,000-ton rotation plan, there will be at least 428,000 tons of cotton waiting to be rotated out before the end of September; third, the 700,000-ton sliding-duty cotton import quota has been issued in batches and one after another starting from July 21. / Inquiries and purchases of cotton outside the October shipping schedule and bonded cotton at ports continue to pick up, which is conducive to cotton textile companies reducing costs and improving the competitiveness of textile and apparel exports. </p
