Tongzhou Cotton Market Brief, Week 2 of March 2023

I. Zhengmian (China's cotton)
(I) Positive Factors
1) A definite reduction in the planting area for the new year, with the government planning to increase the grain planting area by 4.8 million mu, and the cotton planting area is expected to decrease by 10%.
2) Currently, cotton ownership has basically been transferred, with 90% transferred from ginneries to traders and yarn factories. This year, there is more trader involvement, ownership is dispersed, and traders are not in a hurry to ship goods.
3) There is a possibility of a rush harvest in the new year. From the overall situation, the imbalance of supply and demand remains unchanged, and ginneries are profitable this year, so there is still a possibility of a rush harvest in the next year's acquisition of cottonseed.
(II) Negative Factors
1) Current market demand is more about production demand rather than end-user demand, with end-user consumption not performing brilliantly. If order follow-up is not smooth later, yarn may accumulate in inventory.
2) The market reflects a decrease in domestic clothing exports month-on-month, and orders have been significantly lost under policy pressure.
3) With export shortages and only domestic demand, domestic production capacity is severely oversupplied.
II. US Cotton
(I) Positive Factors
1) The current price of US cotton is already significantly deviating from the planting cost of cotton farmers, which is not conducive to cotton planting in the next year.
2) From the perspective of agricultural product price ratios, the current return of cotton is far lower than that of planting soybeans and corn, and the planting area of cotton next year will most likely decrease.
3) Southeast Asia's raw material inventory is relatively low. If US cotton falls below 80, it is expected to trigger spot purchases, supporting the market price.
(II) Negative Factors
1) Financial risks have occurred frequently recently. On the one hand, Powell's speech has increased the market's probability of a 50 basis point interest rate hike in March. On the other hand, the collapse of Silicon Valley Bank may be a microcosm of the suppression of the real economy by high interest rates.
2) The March USDA monthly report increased global production by 160,000 tons and decreased global consumption by 120,000 tons. The stock-sales ratio increased by 2 points to 82.8%, and the global supply-demand situation has become further relaxed.
3) US cotton weekly sales data has weakened for two consecutive weeks compared to previous weeks, indicating weak demand for US cotton.
 
Points to Watch: Financial risks; Domestic order situation after April

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Tongzhou Cotton Market Brief, Week 3 of March 2023

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Tongzhou Cotton Market Brief, Week 1 of March 2023

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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