Driven by the continuous rise of Zheng cotton, pure cotton yarn will have a good start after the year, and the cumulative increase after the year will be less than 2,000 yuan/ton. However, after a brief rise, the price of cotton yarn began to fall since the beginning of March due to sluggish demand and a decline in the Zheng Cotton Index. Currently, it is basically the same as the price a year ago. As of April 8, 2021, CY C32S pure cotton The yarn price closed at 24,125 yuan/ton, down 1,725 yuan/ton or 6.67% from the same period last month.
In terms of raw material cotton, Liu Changxiong, general manager of Yutaihua Company, spoke on March 26 The CNCE Cotton Industry Development Annual Conference stated that there are many irrational factors in the current cotton market. The previous increase was due to speculation. The increase exceeded the fundamentals. The price increase of raw materials was much higher than that of downstream gray fabrics and clothing. At the same time, some traders stocked up large quantities of goods, and a few large traders stocked up to 100,000 tons. Therefore, price declines and returns are inevitable, but when cotton prices fell to a minimum of around 14,300 yuan/ton, they had already fallen below the acquisition cost in Xinjiang, indicating that there was a certain irrational decline and that the Xinjiang cotton incident had triggered a certain market panic. From the perspective of spinning profits, most spinning companies are still profitable. Taking C32S as an example, the immediate profit based on buying now and making now is around 1,500-1,700 yuan/ton. As of March 26, the cotton inventory of textile companies has been closed for 46.3 days, an increase of 5.1 days from February 26. The profit of cotton stocks of textile companies for 20 days has fallen to less than 1,000 yuan, and profits under other inventory levels are also shrinking rapidly. middle. Of course, most textile companies still have a certain amount of raw materials in stock, and the actual profits will vary depending on the stocking cycle. According to recent surveys, the current cotton inventory level of textile companies is relatively high. Most inventories are at 1-2 months, which is relatively high. The inventory is 3 months or more. Based on the 1-month stocking cycle, the current price of C32S cotton yarn remains around 700 yuan.
The cotton yarn market will show the characteristics of booming production and sales after the year. The price of yarn has increased by nearly 2,000 yuan. The orders of yarn mills are currently divided into different categories. I got it at the end of April or May. However, it will be difficult to receive new orders later, and generally after late April is the off-season for consumption. If prices continue to fall, downstream “defaults” may occur. In the short term, cotton prices are expected to fluctuate for a period of time, and cotton yarn inventories have gradually begun to accumulate as demand has weakened recently. At present, the average inventory of textile companies is one to two weeks, which is a slight increase of about 4 days compared with the end of the year, so there is generally no rush to restock. The reason for this situation is that some traders had a wave of stocking up in anticipation of a bullish cotton yarn market a few years ago, which led to overdraft of demand from yarn mills. However, the above situation does not mean that the demand in the cotton industry chain is good. On the other hand, it is reported that the autumn and winter orders for terminal clothing have begun to be gradually issued recently, and have not yet been reflected in the cotton yarn and gray fabric end. Waiting to see the order transmission situation after the Qingming Festival, the orders will also form a certain support for the price of cotton yarn. However, as textile companies gradually digest high-priced cotton, cotton costs decline, and later orders are gradually reduced, cotton price trends will gradually return to industry fundamentals, and cotton yarn prices are still at risk of continuing to decline.
In terms of outer yarn, from Since March this year, the foreign quotations of major pure cotton yarn imports have begun to decline. As of April 8, C32S of printed yarn closed at US$3.27/kg, C32S of Yueshan yarn closed at US$3.13/kg, and C20S of Pakistan closed at US$3.13/kg. It closed at US$2.79/kg, down 7.37%, 11.83% and 6.06% respectively compared with the beginning of March. But we must also mention the exchange rate factor. In 2020, the RMB exchange rate is in the process of appreciation. The turning point occurred near the beginning of February, depreciating by 1.66% from 6.4391 on February 10 to 6.5463 so far.
Since there are currently not many foreign exchange lock-up operations in the imported cotton yarn market, the exchange settlement cost of imported cotton yarn has increased by 250-350 yuan since the depreciation of the RMB. For details, please refer to the table above. Assuming that a large-scale trader purchases 2,000 tons of imported yarn at one time, and the foreign exchange settlement cost is the median value of 300 yuan, then the exchange loss alone will reach 600,000 yuan. In actual circumstances, the settlement of printed and printed yarns is mostly based on 90-day letters of credit, which means that traders who purchase and print yarns need to bear the risk of exchange rate fluctuations within 90 days from the signing of the contract. The rise in import costs has directly weakened the advantage of imported yarn. Coupled with the continuous downward shift in the price center of the imported yarn spot market and the thin trading market, it is not difficult to understand that domestic traders currently have little intention to purchase imported yarn. </p
