Analysis Of Global And Chinese Cotton Market Situation

The future cotton market depends largely on China's policy. China's policies clearly focus on stabilizing the domestic economy, and a series of combined measures have been formed around the work of ensuring the supply and price of bulk commodities. Recently, the State Grain and material reserve bureau announced that it will release copper, aluminum, zinc and other national reserves in batches in the near future. The national development and Reform Commission and relevant departments will establish a joint supervision and regular consultation mechanism for futures and spot markets, so as to promote the rational formation of commodity market prices. The effect of these policies will continue to release. The evolution of cotton market in the future largely depends on the strength of China's policy pre adjustment and fine adjustment and the effect of policy combination.

Cotton market operation will gradually return to fundamentals. At the end of this year, the global cotton supply is relatively abundant. The U.S. Department of Agriculture estimates that by the beginning of 2021 / 22, the global cotton inventory will reach 20.59 million tons, which is the third highest level since 1960. If the late weather, global cotton production is expected to rise steadily. International organizations predict that the global cotton production in 2021 / 22 will be 25.48-25.88 million tons, with a year-on-year increase of 4.7-4.9%; The consumption was 2533-26.679 million tons, with a year-on-year growth rate of only 2-3.8% (last year's growth rate was 9-14.7%). The recovery rate of consumption will gradually slow down, and the marginal support for the market will weaken.

Cotton growth entered the important observation window period of weather. In July, cotton in the northern hemisphere has entered a critical growth period. The weather change is very important for the growth of cotton seedlings, so we should guard against the drastic fluctuation of the market caused by adverse weather.

The transmission of domestic industrial chain is not smooth, and the cost of enterprises increases. Textile raw materials prices rise too fast, pushing up the production costs of enterprises. According to the data of the National Bureau of statistics, in May 2021, the purchase price of textile raw materials increased by 4%, the ex factory price of textile and clothing decreased by 0.3%, and the consumer price of clothing only increased by 0.5%. The weak consumption of terminal clothing is in sharp contrast to the cost inflation, which casts a shadow on the healthy operation of real enterprises.