Cotton Target Price Reform Pilot Steadily

The bottom plan relieved the difficulty of selling cotton.

The four comprehensive measures are to stop the new cotton market after the listing of new cotton, and create favorable market conditions for the purchase and sale of new cotton; do a good job in the acquisition of new cotton, guide enterprises and farmers to actively buy and sell; properly arrange imports, encourage enterprises to make more use of domestic cotton; and formulate a plan for underpinning. When the domestic cotton prices fall too much and there is "difficulty in selling cotton", they will take necessary measures to encourage enterprises to enter the market and buy stable markets.

The industry expects that cotton prices will decline sharply in cotton season in 2014/2015, and the bottom line has become the consensus of the industry.

Sun Liwu, a cotton analyst at Zhuo Chuang, thinks that in 2014, the cotton market showed four characteristics, namely, the continued decline in production volume, the recovery of demand, the oversupply of the market, and the downward pressure of prices.

From the whole

In recent years, domestic and foreign markets have shown a situation of oversupply of cotton.

Data show that the international market has outperformed demand in five consecutive years.

In the past three years, the domestic temporary cotton purchase and storage policy has also formed a large number of national cotton reserves. By the end of August this year, there are still about 11000000 tons of reserve stock, which is equivalent to 1 years of consumption in the country. It is estimated that it will take three years to digest.

Sun Liwu pointed out that the formulation of the "bottom up" plan will effectively alleviate the difficulty of selling cotton and give the market some confidence.

In addition, the proposed measures will be properly arranged.

Encourage enterprises to make more use of domestic cotton.

This means that the import quota system will be further implemented strictly to alleviate the impact of low price international cotton on the domestic market.

Cost of cotton spinning enterprises is expected to decrease

According to Zhuo Chuang's information monitoring data, the estimated interval of lint price in the new year is around 15500-16200 yuan / ton.

At present, the price of seed cotton in Shandong is 3.1-3.6 yuan / kg, compared with 3.8-4.5 yuan / kg in the same period last year.

After the listing of new cotton, the cotton spinning industry will reduce its cost and enhance its competitiveness.

However, yes.

The problem now is how to spend the vacuum period of September.

According to the relevant regulations, the State Cotton store will cease to be put into operation in August 31st, and the cotton textile enterprises will face the embarrassing situation of "no quality cotton can be bought" in September.

The temporary cotton purchase and storage policy in the past three years has almost exhausted the high-quality cotton resources that can be circulated in the market.

As the new cotton market is generally 10 days late this year, new cotton is not expected to enter the mainland cotton mill until October.

The "vacuum period" has limited impact on large enterprises.

A listed cotton textile enterprise purchasing staff told the China Securities Journal reporter that in order to deal with the "vacuum period", the company had bid for "raw cotton" as raw material inventory at the end of August, and when the new cotton was listed, enterprises could purchase new cotton with lower price.

For some small and medium sized cotton textile enterprises that "follow suit", or through the use of import quotas or using viscose, polyester and other chemical fibers to deal with the "vacuum period".