Tongzhou Cotton Market Brief, Week 4, November 2023

I. Zhengmian (China's Cotton)
(I) Bullish Factors
1) A significant characteristic of this year's large-scale cotton acquisition is the decentralized acquisition of resources. Large-scale acquirers have obtained half the resources compared to last year. This decentralized resource acquisition is conducive to strengthening the willingness to support prices.
2) Under the current inverted market, future warehouse receipts are also a concern. As of now, warehouse receipts plus effective pre-orders total only 110,000 tons.
3) Last week, the operating rate of Zhangcha textile mills rebounded slightly, indicating that yarn prices have gradually become less cost-effective, and downstream conditions have improved somewhat.
(II) Bearish Factors
1) Deteriorating downstream demand is intensifying. Last week, the price of ordinary combed 32s yarn fell by another 800 yuan, and the accumulation of yarn inventory at mills continues; the Xinjiang cotton reduction is a false proposition, as acquisitions have reached 5.2 million tons so far. The overall supply-demand situation is continuing to loosen.
2) If there is no replenishment demand from domestic sales channels next year, and at least 400,000 tons of existing cotton yarn needs to be digested, then the domestic supply and demand will be loose.
3) European and American apparel is still in an active destocking cycle, and it needs to go through a passive destocking process before entering a restocking cycle, therefore the export situation in the first half of next year is not optimistic.
II. US Cotton
(I) Bullish Factors
1) Recent weekly reports on US cotton exports show that state reserves are still continuously purchasing US cotton.
2) With a significant reduction in production, the price of US cotton has fallen to around 77 cents, and downstream demand is still showing some price sensitivity.
3) From the year-on-year perspective of wholesaler inventories, the US destocking cycle is indeed nearing its end.
(II) Bearish Factors
1) The restocking cycle in Europe and America is difficult to begin while the global PMI continues to be below the prosperity line.
2) Southeast Asia remains sluggish with no demand; the situation is even worse in Southeast Asia given the decline in Chinese demand.
3) If state reserve purchases come to an end, the lack of support from state reserve purchases will cause a further drop in cotton prices.
Points to Watch: Possibility of Yarn Market Crash
 

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Tongzhou Cotton Market Brief, Week 1 of December 2023

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Tongzhou Cotton Market Brief, Week 3 of November 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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