According to feedback from some farmers and ginners in Kashgar, Aksu and other places, around mid-August, hand-picked cotton in the Corps and local areas has been spun out on a large scale. It is expected that as early as It can be picked around mid-September, while machine-picked cotton needs to be mined from late September to early October. From a time point of view, there is still about one and a half months until the new cotton in 2021/22 is launched (hand-picked cotton in southern Xinjiang will gradually be warehoused and sold after mid-October). For some small and medium-sized cotton spinning mills with low cotton stocks, relatively smooth orders, or a large number of early orders to be delivered, they still need to purchase cotton to tide over the “green and yellow” period. The replenishment efforts of textile enterprises above designated size have weakened, and the wait-and-see sentiment has increased. A small amount of Procurement meets product cotton requirements.
How should small and medium-sized textile enterprises replenish their inventory under the current situation? The author’s views are as follows: First, the bidding for state cotton reserves. The intensity of bidding, average daily transaction price and price increase for cotton reserves have all declined, and the cost of cotton replenishment has dropped (the current average transaction price of Xinjiang cotton from the state reserve is about 1,000 yuan/ton lower than the Xinjiang cotton from the mainland reserve in 2020/21); The second is to receive Zheng Cotton warehouse receipts. In recent days, the prices of Zheng cotton’s near-month and far-month contracts have been inverted, and traders have become increasingly bearish on the cotton market in 2021/22. The CF2201 contract price continues to consolidate in the range of 17400-17600 yuan/ton, and the current price is 400-700 yuan/ton. Compared with commodity cotton, the warehouse receipt transportation and warehousing conditions are better; third, there is a sliding tax or 1% tariff Cotton textile companies with cotton import quotas pay attention to the US dollar quotations of bonded stocks of Indian cotton and Brazilian cotton (US cotton quotations are still 2.5-3.5 cents/pound higher than the same quality Brazilian cotton), and the direct import cost is still lower than the “Double 28” machine in the mainland warehouse The price of cotton picking is 1,500-1,800 yuan/ton, but traders’ quotations for port customs clearance of US cotton/Brazilian cotton have been inverted with Xinjiang cotton, and the competitiveness is weak.
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