Tongzhou Cotton Market Brief, Week 3 of August 2023

I. Zhengmian (China's cotton futures contract)
(1) Positive Factors
1) Downstream improvement: With autumn and winter orders gradually being placed, the operating rate of textile mills is rising, and downstream profits are improving.
2) Tight supply: Following last week's price fixing transactions, trader resources are becoming increasingly scarce, and the market's spot supply remains tight in the short term.
3) The claim of a rush to harvest cannot be verified given the reduced production, ample liquidity, and improved fundamentals for the new year.
(2) Negative Factors
1) Increased supply pressure: A large number of imported cotton yarns will arrive in the future, increasing supply pressure.
2) Weak downstream demand: Downstream orders have improved recently, but the year-on-year feedback remains poor, below the normal level of previous years.
3) The market has been trading on the expectation of a rush to harvest since March this year, with significant front-running, making it highly likely that the subsequent rush to harvest will fall short of expectations.
II. US Cotton
(1) Positive Factors
1) August report shows significant downward revision: US cotton production was significantly reduced by 550,000 tons to 305, and the end-of-year inventory of US cotton, which has been reduced for two consecutive years, is already at a low level.
2) Potential changes in Southeast Asia: The long-term low operating rate in Southeast Asia may be broken in the fourth quarter. For example, Bangladesh currently has very low cotton inventories.
3) US apparel destocking cycle: The US apparel destocking cycle is expected to end in the fourth quarter of this year.
(2) Negative Factors
1) Weak downstream demand: US cotton is completely unacceptable in China above 84 and 85 cents, lacking any competitiveness.
2) Intense competition: US cotton faces fierce competition from Brazilian and Australian cotton.
3) Lack of fund interest: Funds show no significant interest above 85 cents, with net long positions recently declining by 2 percentage points to 19%.
Points to watch: Sustainability of downstream orders; monthly report

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Tongzhou Cotton Market Brief, Week 4 of August 2023

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Tongzhou Cotton Market Brief, Week 2 of August 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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