With the end of the Silver Decade, the textile market is still tepid. With the control of epidemic situation in many places, the confidence of downstream textile workers in the market has dropped significantly. The prosperity index of the downstream cotton textile industry is low, and there are few long-term orders from enterprises, most of which are short and small orders. The raw materials are basically purchased when they are used and just needed. Due to the poor receipt of orders by enterprises, the demand for raw materials has declined slightly. Most enterprises are cautious about cotton procurement and will not hoard goods rashly. The order has not improved. The operating rate of enterprises in some regions is about 70%. Textile enterprises have low bargaining power, and the future market is likely to continue to decline. Weaving enterprises are not active in purchasing. Finished products continue to accumulate in the warehouse, and there is no significant sign of recovery in the short term.
In the last week of October, the haze of declining demand continued to firmly control the cotton market, futures prices continued to fall, and the selling price of seed cotton began to decline slightly. However, Xinjiang cotton enterprises still have some enthusiasm for processing. After all, the pre-sale price of Xinjiang cotton is about 14000 yuan/ton, and the spot sales profit of Xinjiang cotton is considerable. However, with the continuous decline of futures prices and new lows, Xinjiang seed cotton prices began to loosen, the time window for cotton farmers to sell continued to narrow, and the reluctance to sell weakened. Xinjiang’s selling and processing increased, but still slower than the same period last year.
In terms of foreign cotton, the demand for textiles in the international market declined, the global economic data continued to deteriorate, and the economic interaction was in a downturn. The upside down of domestic and foreign cotton prices has continued to narrow significantly, although traders have a strong price sentiment. The total cotton stocks in China’s main ports have dropped to 2.2-23 million tons, and the depreciation of the RMB is very prominent, which to some extent restricts the enthusiasm of traders and textile enterprises for customs clearance of foreign cotton.
In general, for finished products, textile enterprises still adhere to the general principle of de warehousing. From the perspective of consumption, it is difficult for the cotton market to show a strong pattern. With the passage of time, the progress of new cotton acquisition is expected to accelerate. Downstream demand has entered the off-season. The high spot price is difficult to maintain, and cotton futures prices will continue to be under pressure.
Post time: Nov-07-2022