Tongzhou Cotton Market Brief, 4th Week of January 2024

I. Zhengmian (China's main cotton variety)
(1) Bullish Factors
1) Downstream operations have continued to improve recently, with spinning mills and weaving mills increasing their operating rates. Finished goods inventories have continuously decreased and are currently at a low level. With expectations for next year, downstream improvement continues before the New Year.
2) From a seasonal perspective, the downstream sector usually sees improvement after the Lunar New Year each year, experiencing a so-called "small spring"; therefore, there are still expectations in the downstream sector.
3) After the capital inflow last week, a certain degree of price increase is needed for funds to profitably exit.
(2) Bearish Factors
1) Currently, industry operations are mainly driven by the stocking of weaving mills and traders. Whether the "golden March and silver April" will truly arrive remains to be seen. If the peak season is disappointing, the current supply and demand pattern does not support the current cotton price.
2) Weaving mills' raw material inventories, after a month and a half of replenishment, have reached their highest level for the same period in history, and the replenishment trend is nearing its end.
3) After the increase in cotton prices last week, yarn prices did not follow smoothly, and the immediate profits of spinning mills were eroded.
II. US Cotton
(1) Bullish Factors
1) Starting in the fourth quarter of 2023, the overseas market has received orders for clothing from European and American brands. Some brands, after a destocking cycle of about a year and a half, have restored their inventories to normal levels.
2) Currently, sales of Brazilian and Australian cotton are nearing their end. Entering 2024, the main global supply will only be US cotton.
3) Southeast Asia, after a year and a half of losses, has low raw material and finished goods inventories. If overseas markets enter a restocking cycle, overseas demand will rise rapidly.
(2) Bearish Factors
1) Under the influence of El Niño in 2024, US cotton production is expected to recover next year.
2) Although some clothing orders from Europe and America have been placed recently, the order prices are very low, and the profit margin of factories cannot be expanded. Although demand has improved, it is still weak.
3) This year, the expectation of expansion of planting in Brazil is strong, and the production in the new year is expected to increase again, squeezing the US cotton export market.
Points to Watch: The sustainability of downstream improvement
 

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Tongzhou Cotton Market Brief, 5th week of January 2024

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Tongzhou Cotton Market Brief, 3rd week of January 2024

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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