Tongzhou Market Information Brief, Week 3 of November 2021
I. US Cotton
Positive factors:
1) Slow progress in US cotton listing, resulting in lower actual market supply than in previous years, providing support to cotton prices.
2) US cotton accounts for 41% of China's cotton imports. With the easing of US-China relations, China may increase its purchase of US cotton.
3) The recent price gap between domestic and foreign markets has narrowed slightly, but it remains at a historically high level.
Negative factors:
1) The main US cotton contract is at a historical high.
2) US cotton production increased by approximately 22.95% compared to last year.
3) Net long positions of funds have declined for three consecutive weeks, recently falling to 36%.
II. Zhengzhou Cotton
Positive factors:
1) Currently, only 68,000 tons of new cotton registered warehouse receipts are available, and the warehouse receipt issue remains unresolved.
2) The second batch of reserve cotton has been released, and the state reserve needs replenishment.
3) October's textile export data reached $28.9 billion USD, the highest year-on-year amount in history.
Negative factors:
1) The second batch of reserve cotton has been released, with a planned release of 600,000 tons, including Xinjiang cotton from 2019 and imported cotton. The improved quality of cotton has delayed the downstream's use of new cotton.
2) Domestic sales remain weak, with the year-on-year retail sales of clothing, shoes, and textiles in October down by -3.3%.
3) As Xinjiang cotton procurement progresses, the raw cotton purchase price continues to weaken, and the cost price has slightly decreased.
4) High inventory across the entire industrial chain, insufficient replenishment momentum in the future.
Summary: Xinjiang cotton procurement is basically over, and the cost of new cotton has been solidified. The current new cotton purchase price can no longer affect the market. Future trading will depend more on whether downstream consumption improves and whether it can accept such high cotton prices. Currently, the point-to-point profit of spinning mills is still negative, and spinning mills cannot accept such high cotton prices. Terminal consumption determines whether future cotton prices can be successfully transmitted. Therefore, it is necessary to closely monitor and predict changes in downstream terminal consumption.
Focus points: Changes in terminal consumption
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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