Recently, Zheng Cotton has continued to fluctuate sharply. The daily fluctuations of hundreds of points have significantly increased the risks of corporate procurement and order taking. Under the dual game of market expected inflation and interest rate increases, it has caused great difficulties to the normal operation of the company.
It is understood that ICE has rebounded sharply recently, and foreign cotton spot prices have followed suit. Cotton yarn quotations from India, Pakistan and other producing areas have continued to increase. Domestic cotton textile companies have found it significantly more difficult to receive new orders, and their profits have been greatly compressed or even suffered losses. The recovery of the domestic sales market is not ideal either. In order to control risks, companies are destocking. Some textile companies in Henan have taken advantage of the cotton rebound to increase cotton yarn sales and seize funds. Data from the National Cotton Market Monitoring System show that as of early August 2022, the national cotton industry inventory was approximately 631,000 tons, a decrease of 0.9% month-on-month and a year-on-year decrease of 26.6%.
Recently, textile companies said that cotton yarn orders have increased slightly recently, but the increase is not obvious, and the current business situation of the company has not been significantly improved. Data from the National Cotton Market Monitoring System show that in early August, the yarn production and sales rate of enterprises was 89.8%, an increase of 1.7 percentage points month-on-month, and a year-on-year decrease of 3.6 percentage points; the cloth production and sales rate was 85.5%, an increase of 2.5 percentage points month-on-month, and a year-on-year increase of 0.7 percentage points. point. Production and sales data show that the production and sales value of enterprises increased month-on-month in August, but the improvement was limited, which is basically consistent with the feedback from enterprises.
Textile companies believe that the price of cotton raw materials fluctuates sharply, and the production of downstream companies will not be stable, and companies will be greatly restricted in accepting orders. After all, cotton price accounts for the largest proportion of yarn costs, and its rise and fall changes will have a great impact on profits. Impact. Therefore, keeping cotton prices stable has a strong positive effect on stabilizing the development of the industrial chain and improving market confidence.
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