Last week (December 20-24), Zheng cotton prices rebounded slightly, and cotton market purchases and sales showed signs of recovery. Among them, cotton yarn quotations stopped falling and stabilized. Due to the low trading volume in the market, the overall market remained deserted.
Last week, futures prices continued to rebound. The main contract price of Zheng Cotton rebounded from around 19,600 yuan/ton to the 20,000 mark, rising by about 400 points in a week, which was significantly weaker than the previous rebound. The current COVID-19 epidemic has a tendency to come back again. New cases continue to increase significantly internationally, while new confirmed cases continue to be added domestically. Coupled with the increasing difficulty of epidemic prevention in winter and the tightening of epidemic prevention and control measures, there is a risk of intensifying market shocks. At present, raw material companies in the market are holding cotton prices high, and short-term support prices remain stable. Whether cotton prices can continue to rebound in the long term will be affected and restricted by downstream consumption.
Last week, the market had sufficient supply of raw materials and the spot price remained stable. Enterprises are cautious in purchasing and stockpiling. Currently, they mainly use Xinjiang cotton. The price of 3128B grade machine-picked cotton in Shandong warehouse is 22,700 yuan/ton, and the price of 3128B grade hand-picked cotton is 22,800 yuan/ton. Yuan/ton, the price difference between futures and current prices continues to narrow.
According to feedback from some cotton spinning enterprises in Shandong and Henan, some distribution factories and light textile market traders in Guangdong, Jiangsu and Zhejiang have replenished their stocks in small quantities, and cotton yarn transactions have picked up slightly. Affected by the successive rebounds in Zheng cotton prices that week, cotton yarn quotations have stabilized overall. With the double holiday approaching, some companies are considering holidays, and the demand in the cotton spinning industry chain is still facing certain pressure. In addition, the price difference between the quotation of 3128B grade Xinjiang cotton and 1.4D polyester staple fiber is too large. The profit of cotton yarn products is obviously not as good as that of chemical fiber yarn. Some companies have begun to adjust the yarn structure, expand the production of blended yarn and pure polyester yarn, and reduce the production of cotton yarn. This has a great impact on the future. Cotton consumption creates certain pressure.
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