Tongzhou Market Information Brief, Week 4 of October 2021
I. US Cotton
Positive Factors
1) The US is still in an inflationary phase, with the economy and prices still on an upward trend.
2) Slow listing progress in the US this year.
3) With the improvement of Sino-US relations, China's purchase of US cotton has increased.
Negative Factors
1) US cotton production increased by 23% year-on-year, and the growth status of US cotton is the best in history.
II. Zhengzhou Cotton
Positive Factors
1) China is still in a stagflationary phase, with price levels still in an upward cycle.
2) Futures market is deeply underwater.
3) Overcapacity of Xinjiang cotton gins, acquisition pricing.
4) Downstream rigid replenishment demand still exists.
Negative Factors
1) At the national policy level, prices are resolutely suppressed, and measures such as increasing the amount of cotton released in stages and increasing import quotas are adopted to regulate prices.
2) Inventories of cotton-related industries are at a historically high level, second only to 2018.
3) Downstream consumption, both domestic and export, is not optimistic in the future.
Summary: China is currently in a stagflationary phase, with price levels remaining high; domestically, as the Xinjiang cotton acquisition progresses, the acquisition cost is about to be determined. After the acquisition cost is solidified, whether it can be effectively transmitted to the downstream becomes the key. If, like in 2011, there is a virtuous cycle between upstream and downstream, then prices can continue to rise or even hit new highs. However, if the high cotton price is unacceptable to the downstream, then prices will fall rapidly.
Focus: Acquisition progress; downstream changes
Leaders from Xiamen C&D Group visited Tongzhou for investigation and guidance
On March 3, Wang Yongqing, Vice President of Xiamen CNOOC Group, visited Tongzhou Group for investigation and guidance. Wei Gangmin, Chairman of our company; Huang Hongyu, President; Li Tao, Vice President; and Zhang Zhiyan, Director of the General Office, met with and participated in a symposium.
Tongzhou Cotton Market Brief, Week 1 of March 2025
1) This week's National People's Congress and the Chinese People's Political Consultative Conference (NPC & CPPCC) in China boosted market expectations for steady growth. In February, the Purchasing Managers' Index (PMI) for manufacturing stood at 50.2%, up 1.1 percentage points from the previous month, indicating a significant improvement in the manufacturing sector.
In 2024, China's dyeing industry saw rapid export growth to ASEAN and RCEP member countries, exceeding the overall export growth rate. However, this growth was accompanied by a decline in prices. From January to December, China's exports of eight major dyeing products to ASEAN totaled 7.908 billion meters, a year-on-year increase of 12.14%, 4.61 percentage points higher than the overall export growth rate, accounting for 23.58% of total exports. The average export price was US\$1.19 per meter, a year-on-year decrease of 2.75%, 0.64 percentage points lower than the overall decline. Exports to RCEP member countries totaled 8.431 billion meters, a year-on-year increase of 11.35%, 3.82 percentage points higher than the overall export growth rate. The average export price was US\$1.17 per meter, a year-on-year decrease of 2.79%, 0.60 percentage points lower than the overall decline.
On February 28, Mr. Huang Hongyu, President of our company, was invited to attend the 2025 Zhangjiagang Cotton Industry Development Conference and, as a guest speaker at the "Xiangshan Roundtable," shared his views on the cotton market and trading opportunities.
Henan Tongzhou Cotton Industry Co., Ltd.
Contact
Henan Tongzhou Cotton Industry Co., Ltd.
Address: 10th Floor, Henan Nongxin Building, No. 19 Commercial Outer Ring Road, Zhengdong New District,Zhengzhou, China
Tel：86037165836206
Email：tongzhou@tongzhoucotton.com
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