In mid-August, cotton began to spew in Xinjiang and some parts of the mainland. It is less than a month and a half before the new cotton for the 2020/21 season is launched. Cotton processing enterprises’ machine maintenance, fund preparation, firefighting and safety personnel training and other work are all progressing in an orderly manner. . Judging from the survey, due to the recent high-temperature production restrictions of cotton textile companies, weak cotton yarn volume and price, the new crown epidemic and rising uncertainties in the external environment, the main contract of Zheng Cotton has also been adjusted back to around 12,700 yuan/ton, and the basis price of cotton companies Enthusiasm for purchasing Xinjiang cotton spot goods is not high, and transactions are relatively weak.
In recent days, the author conducted a simple survey on several downstream cotton spinning mills with 20,000 to 100,000 spindles, and briefly summarized the current cotton spinning situation as follows:
First, Guangdong, Jiangsu and Zhejiang, etc. As foreign trade orders in coastal areas have picked up compared with May and June, consumer demand for high-grade yarn has shown a slight, phased increase. Textile enterprises’ ability to digest and accept high-grade lint cotton such as “Double 28, Double 29” is more obvious than in May and June. Increase, but the lack of large orders, long-term orders, and high value-added orders worries textile companies.
Second, in major textile provinces such as Shandong, Hebei, Henan, and Hubei, the phenomenon of small yarn mills and cloth mills reducing and suspending production due to high temperatures and lack of additional orders is becoming more and more prominent. However, small factories are gradually withdrawing. In sharp contrast, large factories are expanding and quickly occupying the customers and markets ceded by small factories.
Third, cotton yarn products continue to downgrade. A large textile company in Ningbo said that except for some profits from special yarns, organic cotton yarns and new fiber yarns, almost all combed yarns of 50S and above and high-end carded yarns are at a loss. Therefore, the factory has experienced high counts since July. Spinners only accept “customized spinning” orders to reduce the risk of high-count yarns tying up funds and making it difficult to collect payments. Spinners in Jiangsu and Shandong reported that except for C21S-C40S yarn inquiries and transactions, which are relatively concentrated (including 26S), OE yarns and low-count ring spinning yarns are severely overstocked. In order to keep production and ensure employment, spinners Without layoffs, we can only reduce yarn count and cotton distribution.
Fourthly, some textile companies have a demand for a moderate amount of cotton replenishment in August and September. However, due to sluggish cotton yarn prices and sales, they hope to place orders when the CF1201 contract drops to around 12,500 yuan/ton.
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