Tongzhou Cotton Market Brief, Week 1 of September 2022
I. Zhengmian (China's cotton)
(I) Positive factors
1) September marks the official start of the peak season, and the market still has certain expectations for it. All aspects are currently in the replenishment stage.
2) After nearly a month of inventory reduction, yarn mills' finished product inventories have rapidly decreased, especially for small and medium-sized enterprises. Inventory pressure has eased, and yarn mills have the willingness to replenish both finished product and raw material inventories.
3) The recent rapid devaluation of the RMB is conducive to exports, coupled with high domestic and international yarn prices, some companies have recently exported cotton yarn.
(II) Negative factors
1) The widespread outbreak of the epidemic last week in China, with cities like Chengdu, Shenzhen, and Wuhan requiring work from home, may lead to the 'Golden September, Silver October' expectations being dashed.
2) Although the downstream is in a stocking phase, confidence is generally low. The direction of fabric and textile mills remains unclear. If expectations are truly unmet, stocking will cease.
3) Due to the Xinjiang epidemic, Xinjiang cotton cannot be shipped normally, exacerbating the supply-side contradictions of cotton in the later period.
II. American Cotton
(I) Positive factors
1) Cotton is currently in a critical boll-opening period, requiring temperature and sunlight. However, two consecutive weeks of rainfall in the Delta region will affect cotton growth, the boll-opening progress, and quality in the Delta region.
2) This year is a hurricane season. If a hurricane hits later, it may trigger short-term price fluctuations.
3) Pakistan's reduced production may increase imports of American cotton later, intensifying the tight supply situation of American cotton.
(II) Negative factors
1) The growth conditions in the other three major cotton-producing regions globally (China, India, and Brazil) are good. Brazil's production is expected to be 2.6 million tons, an increase of about 250,000 tons; India's planting is complete, an 8% increase year-on-year, and current rainfall has not had a substantial impact on production.
2) In Southeast Asian countries, the operating rates of yarn mills in India and Pakistan continue to decline. This week, Indian yarn mills reduced the rate by another 2 percentage points, and Pakistan by 1 percentage point.
3) From the perspective of the terminal inventory cycle, Europe and the United States have entered a stage of active destocking, and the global market is entering a destocking cycle.
Points to watch: Opening price; Downstream orders
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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