According to feedback from several cotton traders in Henan, Jiangsu and other places, the market price of Zheng cotton CF2209 contract has returned to the range of 17,000-17,500 yuan/ton in the past two trading days. Coupled with factors such as the tightening of funds for cotton companies in July, a few traders point The price basis has been reduced, which has triggered the attention and procurement of some cotton textile enterprises and middlemen, and the transaction volume has increased compared with mid-to-late June.
A cotton company in Xuzhou, Jiangsu Province said that since the beginning of July, customer inquiries from Nanyang, Henan, northern Anhui, and Heze, Shandong have been much more active than in the previous period, especially for Xinjiang low-basis cotton in 2021/22 (mainly Ili, Tacheng, Changji , Shihezi and other origins) the transaction is slightly faster. The company lowered the basis difference by 50 yuan/ton and took the initiative to facilitate transactions. Since last weekend, it has signed contracts to sell 12 batches of Xinjiang machine-picked cotton (including Xinjiang’s regulatory warehouse resources).
Judging from the survey, a large number of cotton textile companies believe that the current cotton futures price has dropped to an acceptable range, and has even dropped more than expected. Calculated based on the real-time cotton spot price, spinning production and sales prices are no longer “upside down”, but At present, the main contradiction is that terminal orders for gray fabrics, fabrics, and clothing are insufficient or even seriously insufficient. Due to the unsatisfactory order-taking situation in the second and third quarters of 2022, the operating rate of weaving, printing and dyeing companies in coastal areas is below 60%, and they have not yet recovered.
In addition, the United States has banned Xinjiang cotton and the RMB exchange rate from fluctuating widely, which has increased the probability of Christmas and Easter orders being transferred to Southeast Asian countries such as Vietnam, India, and Indonesia. Cotton textile mills are afraid to store raw materials and finished products because of the huge demand. Uncertainty. Especially since 2022, the payment recovery at the end of the entire cotton textile industry chain has been slow, the account period has generally been extended by 1-3 months, and cotton companies have become more cautious.
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