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India'S Ban Is &Nbsp; Cotton Price Trend Looks Downstream.

2012/3/12 14:23:00 7

Cotton Price Trend In India

  

India government

Cotton exports were banned on Monday, including export orders already registered by their government.

With the promotion of the news, Zheng cotton's contract was red on the 5 day, and the main 1209 contract closed to 22000 yuan / ton.

But then the ban was opposed by the Ministry of agriculture of India, and the price again returned to 21600 yuan / ton.

India will revisit the ban on cotton exports this Friday. I believe that although the export ban in India has been repeated, the impact on cotton prices in China is only temporary. The trend of cotton prices in the later stage still depends on the color of downstream demand.


Since 1999, China has been importing cotton sporadically from India. The proportion of total cotton imports in China is not high, only 0.74%.

However, since 2003, the proportion of cotton imports from India has gradually increased.

As of 2011, China's cotton imports from India accounted for 30.15% of the total cotton imports in China.

At present, the share of China's cotton import market is that the United States and India each account for 1/3, and the remaining 1/3 market is divided by Australia, Brazil, Uzbekistan and other small countries.


Looking at the expected volume of exports in India this year, according to the latest report of the US Department of agriculture in February, India expects to export 1 million 360 thousand tons of cotton this year.

Up to now, the amount of cotton exported has been about 800 thousand tons.

That is to say, India's policy of export restriction has reduced the volume of global cotton trade by 560 thousand tons.

This year, the output of the world's cotton is 26 million 855 thousand tons, and its consumption is only 23 million 887 thousand tons. That is to say, the supply of global cotton is extremely abundant this year.


according to

American agriculture

The Ministry predicted that China's cotton production will be 7 million 294 thousand tons, 9 million 580 thousand tons of consumption and 3 million 701 thousand tons of imports this year.

But in 2011, the implementation of State purchasing and storage policy created a shortage of cotton supply as a whole.

It is reported that as of March 8th, the total amount of cotton storage and storage in 2011 reached 2 million 767 thousand and 310 tons.

Now India also restricts exports, reducing the import of cotton in China. China's cotton is in a tight supply situation.


However, it should not be overlooked that the state's purchase and storage is also a double-edged sword. The latter does not exclude the possibility of state dumping.

Therefore, we need to re estimate the supply and demand data of cotton in China.

As of January, China's cotton import volume has reached 2 million tons this year, and it is estimated that there is a shortage of 286 thousand tons as a whole.

For the shortage, (1) the number is not very large. If downstream consumption can not keep up, the overall supply and demand should be weakly balanced. (2) in the latter 6 months, cotton can be imported from other countries.

Looking at the US alone, China signed a total of 1 million 343 thousand tons of cotton and 558 thousand tons of total shipment in February 23rd. Our country can also import 785 thousand tons of cotton from the United States.

By the end of March 31st, the estimated reserves will reach 3 million tons.

Even if consumption is improving and supply is scarce, the state will take up reserves to make up for the supply gap.


and

Downstream of cotton

Consumption is still not optimistic.

It is reported that the downstream textile enterprises of the cotton industry have been slow in sales since the Spring Festival, with fewer orders, showing signs of not booming in the peak season.

As for whether there is a noticeable rebound in the traditional peak season of consumption in March, there is no sign of any obvious improvement.


For the late export market of textile and clothing, dragged down by the continued escalation of the European debt crisis, the economic recovery in developed countries, such as the United States and Europe, is weak, which restricts the demand for textile and clothing, and implicates that the growth rate of garment exports in developing countries is reduced.

In the first half of 2012, China's textile and garment export demand and competition pressure will be more prominent. The number of exports will be low or negative in the first half of this year.

For the domestic market, the growth rate of clothing consumption will also slow down in the context of the slowdown in China's macroeconomic growth and the slowdown in consumption growth compared with the previous year.


On the whole, the focus of the cotton market is still downstream consumption, and cotton prices are hard to rise under the premise of no obvious improvement in consumption. It is estimated that the cotton price will still be weak in the late stage of purchase and storage and consumption constraints.

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