Tongzhou Cotton Market Brief, 3rd week of June 2024

I. Zhengmian (China's cotton futures contract)
(1) Positive Factors
1) The current downstream off-season is nearing its end, and prices have reflected the negative factors in the industry. It is expected that downstream companies will begin stocking up for autumn and winter clothing at the end of June, and demand will marginally improve.
2) Downstream raw material inventories are extremely low. Cotton inventories at yarn mills and cotton yarn inventories at fabric mills are both at very low levels. If demand improves, the replenishment demand will be significant.
3) The high point of US interest rates overseas has been seen. In the future, as interest rates are lowered, market pressure will decrease, and domestic policies are also guiding towards inflation. Therefore, from a macroeconomic perspective, it is safer to buy low.
(2) Negative Factors
1) The weather in Xinjiang and other major cotton-producing regions globally has been favorable. The 2024/2025 season is likely to be a bumper year, which will inevitably put pressure on cotton prices.
2) As prices continue to fall, the pressure on unsold resources held by upstream large holders is increasing, and the pressure to maintain collateral is also increasing. Future sales cannot be ruled out.
3) The downstream sector has entered a significant consumption off-season, and the operating rates of yarn mills and fabric mills have accelerated their decline. Downstream demand is still weakening, and no new orders are currently visible.
II. US Cotton
(1) Positive Factors
1) Texas has entered a period of weather speculation. In June and July, the market is highly sensitive to weather, and this is even more important in years when El Niño transitions to La Niña.
2) US cotton has entered an undervalued state. Southeast Asia has a strong willingness to price below 70, and spot profits have significantly improved.
3) Currently, looking at the price difference between domestic and international markets, foreign cotton still has a competitive advantage, and foreign cotton has a higher cost-performance ratio compared to Zhengmian.
(2) Negative Factors
1) Texas still experienced rainfall this week, which helped alleviate the impact of high temperatures and improve soil moisture.
2) There are no bright spots in Southeast Asian demand. Yarn prices in India and Vietnam are still falling, Pakistan's operating rate is declining, and demand remains weak.
3) To date, the weather in the United States and Brazil continues to be favorable for cotton production. There are no weather problems.
Focus: US weather

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Tongzhou Cotton Market Brief, Week 4 of June 2024

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Tongzhou Cotton Market Brief, Week 1 of June 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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