At present, downstream textile companies are on holiday one after another, Zheng cotton is consolidating in a narrow range, and lint quotations from cotton processing companies in and outside Xinjiang are gradually decreasing, echoing the deserted cotton spot inquiries and transactions.
A medium-sized textile company in Jiangsu said that the main contract of Zheng Cotton has only been adjusted back by 200-300 points, and the decline is obviously lower than the expectations of cotton-using enterprises. Therefore, there are no plans to replenish the inventory and obtain goods in large quantities before the holiday. In addition, cotton import quotas within the 1% tariff have been gradually issued to enterprises, and the demand for raw materials has been supplemented. However, some ginners and traders in Xinjiang believe that the external price remains high, and the comprehensive cost of Xinjiang cotton in storage is high, and most cotton spinning mills , traders’ inventories are significantly lower year-on-year, and the CF2205 contract is more likely to open the 22,000 yuan/ton mark, so there is limited room for active profit concessions and price reduction sales.
It is understood that due to the impact of the main contract of ICE cotton futures falling from highs to below 120 cents/pound, the US dollar quotations of imported foreign cotton cargo and bonded cotton fell accordingly, and the price difference between domestic and foreign cotton has expanded (under 1% tariff), which is beneficial to Sales of medium and high-quality lint cotton such as American cotton, Brazilian cotton, and Australian cotton. On January 25, the quotations of bonded Brazilian cotton M 1-1/8 in Qingdao Port and Zhangjiagang were concentrated at 137.95-138.95 cents/pound (trader quotation), and the direct import cost under 1% tariff was about 21,250-21,400 yuan/ton (net weight ), which is more than 2,200 yuan/ton lower than the current “Double 28” grade Xinjiang machine-picked cotton in warehouses such as Shandong, Jiangsu, and Henan, which means the price of imported cotton is relatively competitive.
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