Dezhou, Shandong: Cotton Prices Slump And Cotton Farmers Switch Production

Affected by the drop in cotton prices and sluggish demand, Cotton spinning industry Overall recession, cotton growers, cotton processing enterprises, Spin Enterprises and other industries collectively complain. Cotton processing enterprises stop production or half stop production, cotton textile enterprises slow sales, cotton farmers have "abandoned cotton from grain". According to the insiders, the cotton growers will turn their new products into a new cycle.

Dezhou, Shandong, is located in the northwest plain of Shandong Province. It is a traditional cotton producing area. It is also an important textile base of the whole country. There are 247 cotton textile enterprises in the city, and the annual demand for cotton is about 450 thousand tons. At present, seed cotton is here. Price Dropped to around 7.8 yuan per kilogram, down 44% compared to the same period.

Ma Yuzhen house in the old town of Wuzhai County, Dezhou, has planted 13 mu of cotton, and this year a total of 3300 kg of seed cotton has been harvested. Reporters recently saw in her house that the rooms and corridors were covered with cotton. She said, "the price is not high enough to even pack up. Now some good seed cotton can be sold to 8 yuan per kilogram, and some can only sell more than seven yuan per kilogram, so this year is a busy job! "

Wang Xijun, member of the China Cotton Association and President of the Shandong Xi Jin county, he said, "cotton prices are low this year, and cotton farmers' profit margins are too thin." According to the cotton association of Dezhou, the cotton planting area of the whole city will decrease by 20%-30% next year.

Ma Junkai, Deputy Secretary General of Dezhou Cotton Association, said that since the beginning of March this year, cotton prices have dropped sharply as cotton prices have dropped sharply. Textile enterprises are operating very hard. In 5-7, 80% of the local small and medium sized cotton textile enterprises ceased production and limited production, and their difficulty was no less than the impact caused by the financial crisis in 2008. Since the end of August, cotton prices have improved as cotton prices have stabilized and picked up. Since the middle of September, the spot price of cotton has continued to decline, which has a certain impact on the downstream market. The purchasing intention of weaving and clothing customers is not strong, resulting in the sale of cotton yarn is blocked, and the average operating rate of cotton yarn enterprises is only about 70%, and production and operation are again in a predicament.

Ma Junkai said that due to the weak cotton production base and the substantial increase in production costs, the price fluctuation caused the whole industrial chain to encounter difficulties, which caused the greatest impact on cotton growers. This has seriously affected the enthusiasm of cotton growers, and the planting area of some cotton producing areas has continued to decline.

For processing enterprises, the downstream demand is flagging and the export environment is not optimistic. This is the biggest problem. Sun Ronggui, general manager of Cambridge Cotton Industry Co., Ltd., Wucheng County, said: "the biggest problem now is that I can't see spring. Every day I receive many industry information on my cell phone, but everyone is a hopeless voice."

Meng Qingshun, chairman of Huayi Group, Wucheng County, said that domestic textile enterprises occupied the market and developed rapidly over the years with low raw material cost and labor cost advantages. In recent years, domestic labor costs have risen rapidly, the cost of domestic cotton textiles has increased, international competitiveness has declined, and foreign trade orders have been seriously lost. This is evident from the 110 Canton Fair which was closed soon.

It is understood that the 110 Canton fair transaction data is not optimistic, European and American orders are not enough, the reduction of 20% to 30%, and 6 months less than the total number of orders accounted for more than 80% of the total, the lack of long list.

According to the analysis of the industry, although the national temporary purchasing and storage policy has stabilized the cotton price, the new round of reshuffle is still inevitable. China's labor costs continue to rise, and domestic cotton prices are higher than the international cotton prices for a long time. The situation of tight funds will also continue. These unfavorable factors for cotton spinning industry can hardly be fundamentally changed. Therefore, the cotton spinning industry will have a new round of big reshuffle, and a group of enterprises with poor capital and technological strength will be forced to withdraw from the market.