【2020 Chairman's Interview】Three Core Contradictions Facing the Cotton Market

【2020 Chairman's Interview】Three Core Contradictions Facing the Cotton Market
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  • 【2020 Chairman's Interview】Three Core Contradictions Facing the Cotton Market
At the 2020 China Cotton Textile Forum held on August 21, Wei Gangmin, chairman of Henan Tongzhou Cotton Industry Co., Ltd., expressed his views on the supply and demand situation of the cotton market and new trading opportunities for the new year.
Mr. Wei raised three core contradictions on how to view the cotton market:
First, the contradiction between the new coronavirus and humanity. At the beginning of the epidemic, the market's fear led to a drop in cotton prices from over 14,000 yuan/ton to around 10,000 yuan/ton within a month, and it has slowly recovered to around 13,000 yuan/ton. Recently, the market has shifted from fear to worry. Some are optimistic that the epidemic is over, while others believe that the marginal changes are too small. The vaccine is the key to ending the epidemic, and whether the virus will mutate, whether the epidemic can be overcome, and how long it will take to overcome it are important factors affecting the later stage.
Second, the contradiction between the macro and the industry. With the support of macroeconomic policies, the stock market has risen and then stabilized, and the futures market has slightly recovered. For the cotton textile industry, the upstream has high inventory, low valuation, and weak driving force, with valuation slightly above the trough, and the price cannot see a clear driving force. According to the current research on the actual situation, the spinning sector has accumulated inventory and reduced production capacity. Many bulk commodities have recovered under the stimulus of monetary policy. Whether monetary policy has given sufficient valuation in terms of cotton and cotton yarn remains to be verified.
Third, the contradiction between supply and demand. Enterprises currently have orders, but the order volume has not reached expectations. Currently, the downstream is still replenishing inventory, and the terminal clothing factories also have high inventory.
Based on the current situation, with downstream support and upstream pressure, there is no sign of macro and industrial chain resonance in the short term, and there are no signs of sharp rises or falls, indicating that there is no significant disagreement in the trading aspect.

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2019 Chairman's Interview: Finding Relative Certainty in Uncertainty

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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