According to reports from cotton companies in Henan, Shandong, Xinjiang and other places, cotton basis spreads have been reduced since this week. Domestic cotton spot price transactions are relatively active, while fixed-price sales have basically stagnated. Some small and medium-sized cotton spinning mills that postponed purchases after the holidays have increased their operations to buy goods at low prices.
A cotton trading company in Henan said that the cotton market needs to pay attention to the following three changes in March and April: First, since mid-February, the transfer of Xinjiang cotton to the main consumption areas inland has continued to increase (vehicle shipments out of Xinjiang have increased significantly), and in-transit quotations Resources have increased significantly, and it is expected that the price difference between Xinjiang cotton and Xinjiang will gradually narrow from 600-700 yuan/ton; secondly, due to the large price difference between cotton and polyester staple fiber, viscose staple fiber, etc., chemical fiber raw materials are becoming more and more substitutes for cotton. It is highlighted that some institutions and cotton-related enterprises have estimated cotton consumption demand in 2021/22 on the high side, with large errors; third, there will be insufficient new orders in the second quarter of 2022, coupled with low profits from high-cost and high-value-added textile and clothing orders, The risk is relatively high. After the Spring Festival, some cotton textile companies have adopted measures such as reducing yarn count, reducing cotton grade, and reducing production rates. Locally produced cotton with better batch labels, Xinjiang cotton with low basis difference, and imported customs clearance cotton have attracted attention.
It is understood that from March 2 to 3, the quotations of “Double 28” Xinjiang machine-picked cotton in Shandong, Jiangsu and other inland warehouses were concentrated at 23,150-23,300 yuan/ton, and the quotations of “Double 29” Xinjiang machine-picked cotton were 23,350-23,500 yuan/ton. Yuan/ton, while the net weight quotation of Brazilian cotton for customs clearance at the port is 23,200-23,700 yuan/ton, while the quotation of US cotton for customs clearance of the same quality is 400-600 yuan/ton higher than that of Xinjiang cotton in mainland warehouses.
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