Direct Subsidies, Emergency Rescue Cotton Industry Chain Crisis

The long-awaited domestic cotton subsidy policy was finally introduced on Tuesday, and the subsidy scope was determined to be 9 provinces such as Shandong and Hubei.

It is reported that the subsidy standard in 2014 is 2000 yuan / ton, and the subsidy standard in the following years is based on 60% of the subsidy amount in Xinjiang, and the upper limit is not more than 2000 yuan / ton.

Xinjiang's subsidy standard has already been promulgated, and the target price of cotton is 19800 yuan / ton, which is lower than this price and is subsidized by the government.

To a large extent, the measures have made up for the defects of the past policy of purchasing and storage, and really played an important role in saving the cotton industrial chain. The effectiveness is mainly reflected in four aspects.

First, direct subsidy measures have greatly increased the enthusiasm of cotton growers.

Cotton prices have continued to decline in recent years, and cotton farmers' enthusiasm has been significantly frustrated, resulting in the reduction of cotton planting area in the mainland at a rate of about 10% a year.

If no direct subsidy measures can be introduced, the cotton planting area will continue to decrease next year.

The introduction of direct subsidies has undoubtedly given cotton farmers a reassurance to turn the original losses into profits, thereby reversing the continuing decline in cotton planting area.

In addition, if cotton planting efficiency is improved, cotton farmers will be more willing to grow cotton than the high input of physicochemical inputs and the sale of cash crops that are not guaranteed.

Second, direct subsidy measures are conducive to increasing the enthusiasm of cotton farmers to sell seed cotton.

Due to the lack of mainland China

After comparing seed cotton purchase price and planting cost input, it may fall into a just break even loss situation, so cotton farmers' enthusiasm for selling seed cotton is decreasing, and most of them are wait-and-see attitude.

This has led to the fact that most cotton enterprises in the mainland are unable to catch up with the purchase volume.

Cotton enterprises, on the one hand, can not get the seed cotton, and the processing appears to be "no rice pot". On the other hand, the repayment period of bank loans is getting closer and closer, and survival is bound to be in a state of being caught in the rear.

The introduction of direct subsidy policy has made cotton growers see the hope and reduce their worries, which can not only enhance their enthusiasm in the sale of seed cotton, but also ease the shortage of raw materials in cotton enterprises.

Third, direct subsidy measures can reduce the cost of cotton enterprises and enhance market competitiveness.

The reason behind the sluggish sales of domestic lint market is that cotton farmers are reluctant to sell.

It can be seen that, according to the current purchase price of 3.15 yuan / kg, the lint cost is 14200 yuan / ton, and then the financial cost and other expenses. The estimated sales price is at least 14800 yuan / ton, while the current cotton price in the mainland is only 14500 yuan / ton.

The cotton farmers will not do anything like this.

After the introduction of direct subsidy measures, cotton growers will have profits, which will surely increase the enthusiasm of cotton farmers to sell.

With the increase of market sales, buyout companies have a certain initiative in the market, which is conducive to controlling acquisition costs and active spot market.

Fourthly, direct subsidy measures promote raw material procurement of textile enterprises.

With the continuous decline of cotton planting area in the mainland, textile enterprises have already felt the shrinking of the raw material purchasing market, and have to buy seed cotton from thousands of miles away in Xinjiang.

This is not only a long way to go, but also a long pportation cycle, and the proportion of machine picked cotton in Xinjiang is bigger and bigger.

The introduction of direct subsidy measures will help stabilize the cotton growing area in the mainland and widen the scope of procurement of textile enterprises.

The cost of using cotton.