2014 Chairman Interview: Honing True Skills, Competing on the International Stage

2014 Chairman Interview: Honing True Skills, Competing on the International Stage
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  • 2014 Chairman Interview: Honing True Skills, Competing on the International Stage
In the hot summer of July, our group visited Tongzhou Cotton, headquartered in Zhengzhou, Henan Province, in the heartland of China, to interview Chairman Wei Gangmin about Tongzhou Cotton's "going global" strategy.
 
Tongzhou: From the Central Plains to the International Stage
 
Early Layout of Overseas Markets, Achieving First-Mover Advantage According to Chairman Wei, Tongzhou began its "going global" strategy decades ago, establishing offices in major cotton-producing countries such as Uzbekistan, the United States, and India to gather information and seek business opportunities.
 
Since 2011, China has implemented a temporary cotton reserve policy, squeezing the market space for cotton traders. However, Henan Tongzhou has forged a distinctly different path to success. During the three years of domestic cotton reserves, through cooperation with local cotton gins in India and adhering to a principle of integrity, Henan Tongzhou carved out a path in the Indian market. Progressing from relying on international cotton merchants to collaborating with them, and finally surpassing them. Chairman Wei proudly stated, "Tongzhou's reputation in India may be even greater than in China."
 
Strict Quality Control: Transforming Indian Cotton into a Premium Product Indian cotton, while inexpensive, is known for inconsistencies and exceeding acceptable levels of impurities, leading to criticism from domestic textile mills. However, Henan Tongzhou's Indian cotton sells exceptionally well, with exports to China in high demand. This is primarily due to Tongzhou's unwavering commitment to quality control at every stage, with experts overseeing the process to ensure that cotton shipped to bonded warehouses meets the standards of Chinese textile mills. This meticulous attention to quality has built a gold-standard reputation and secured significant market share.
 
Tongzhou's Business Model Fuels Global Expansion When discussing the challenges faced in Tongzhou's "going global" strategy, Chairman Wei highlighted four key areas: talent, capital, navigating foreign trade regulations and achieving a balance of interests, and market research capabilities. For talent, Tongzhou focuses on internal cultivation, believing that this fosters loyalty and a sense of belonging. For capital, Tongzhou currently relies on financing through its parent company to support its overseas subsidiaries. Regarding foreign trade regulations and balancing interests, Tongzhou has learned through experience, collaborating with locals and sharing profits to create mutually beneficial partnerships. For market research, the company has a dedicated team providing comprehensive market information and analysis.
 
Four Pillars of Success: Building a Thriving Market
 
Meeting Four Interests Creates a Strong Market Chairman Wei also shared his views on the cotton market, stating that a healthy market should satisfy four key interests: farmers, cotton enterprises, traders, and the nation. While temporary reserves protect farmers' interests, the other three are often neglected. In contrast, the target price subsidy policy better balances these four interests.
 
Reform Requires a Level Playing Field Regarding cotton market reform, Chairman Wei stated, "Reform requires placing Chinese and foreign companies on an equal footing." This sentiment likely reflects the unspoken desires of many private entrepreneurs.
 
Self-Reliance: The Path to Success When asked about policy support or specific requests, Chairman Wei stated, "Tongzhou has never relied on government support, preferring to focus on hard work." This self-reliance has undoubtedly contributed to Tongzhou's success. More companies like Tongzhou, with private enterprises leading the way in "going global," would significantly enhance China's international influence.
 
Greater Uncertainty in the New Year, Requiring a Cautious Approach Regarding the cotton market outlook for the new year, Chairman Wei noted that 2014 presents several uncertainties, but a steady, step-by-step approach is key.
 
Chairman Wei believes that Chinese people are not inferior to foreigners, and that China has excellent cotton traders. With a long-term perspective, we look forward to seeing more successful Chinese cotton traders on the international stage, contributing to the Chinese Dream of national rejuvenation.

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Leaders from Xiamen C&D Group visited Tongzhou for investigation and guidance

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.

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Leaders from Xiamen C&D Group visited Tongzhou for investigation and guidance
Tongzhou Cotton Market Brief, Week 1 of March 2025

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.

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Tongzhou Cotton Market Brief, Week 1 of March 2025
In 2024, China's exports of dyed and printed fabrics to Vietnam and Bangladesh increased significantly.

In 2024, China's exports of dyed and printed fabrics to Vietnam and Bangladesh increased significantly.

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.

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In 2024, China's exports of dyed and printed fabrics to Vietnam and Bangladesh increased significantly.
President Huang Hongyu was invited to attend the 2025 Zhangjiagang Cotton Industry Development Conference

President Huang Hongyu was invited to attend the 2025 Zhangjiagang Cotton Industry Development Conference

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.

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President Huang Hongyu was invited to attend the 2025 Zhangjiagang Cotton Industry Development Conference

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