Tongzhou Cotton Market Brief, Week 2 of May 2024

I. Zhengmian (China's cotton futures contract)
(1) Positive Factors
1) Downstream consumption remains resilient, overall operating rates remain high, finished goods inventories are at a low-to-medium level, cotton consumption has not decreased, and currently, with cotton prices falling, downstream buyers are actively pricing cotton.
2) Major suppliers are still maintaining prices, and their resources are not currently available to the market.
3) The 2024 Government Work Report sets the inflation target at 3%, and China's policy this year is to allow for inflation; therefore, given its intrinsic value, cotton can be held long-term at its current low price.
(2) Negative Factors
1) Yarn and fabric mills are marginally entering the off-season, operating rates are showing signs of decline, finished goods inventories are slowly rising, and negative factors from downstream are accumulating.
2) If prices continue to be under pressure, major upstream players may start to exit the market at a loss.
3) As of now, the weather in Xinjiang has been favorable, indicating a bountiful harvest, and next year's production is expected to increase compared to normal years.
II. US Cotton
(1) Positive Factors
1) The current signing and shipment volumes of US cotton have not decreased significantly, and the extremely low end-of-season inventory of the old crop may still be achieved.
2) The net long position of funds has rapidly dropped to 4%, reaching a historical low, indicating that this wave of long positions has retreated, and the 'long liquidation' situation is expected to end.
3) Southeast Asia has low raw material inventories, and with the slow start of the US apparel inventory cycle, there is rigid demand for US cotton.
(2) Negative Factors
1) New-crop US cotton and Brazilian cotton will increase production by a total of 1.2 million tons, confirming an increase in global supply next year. However, with the US economy weakening, the growth rate of demand is questionable.
2) The operating rates of India, Vietnam, and Pakistan in Southeast Asia have decreased month-on-month, and demand is marginally weakening.
3) As of now, the weather in the US and Brazil continues to be favorable for cotton production, with no weather-related issues.
Points to Watch: Whether buying from Southeast Asia remains active

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Tongzhou Cotton Market Brief, 3rd week of May 2024

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Tongzhou Cotton Market Brief, Week 1 of May 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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