Tongzhou Cotton Market Brief, 3rd week of December 2024

I. Zhengmian (China's cotton futures contract)
(1) Positive Factors
1) Downstream yarn mills are replenishing their stocks before the year-end. Yarn mill raw material inventories have increased week-on-week recently, and fabric mills' raw material inventories have also reached their lowest levels for the same period. Downstream mills may replenish stocks at any time.
2) Ginneries are unwilling to accept losses in the short term, providing strong cost support for the 01 contract.
3) Given the relatively positive expectations for future domestic macroeconomic policies, the possibility of a domestic economic crisis is low, limiting the downside of cotton prices.
(2) Negative Factors
1) Domestic macroeconomic policies have temporarily been implemented. There are no additional policy expectations before the year-end, and domestic macro factors cannot further boost the market.
2) As futures prices fall, downstream buyers continue to postpone their replenishment expectations. Yarn mill finished goods inventories have again reached high levels. If future demand is weak, yarn mills will reduce operating rates or shut down in advance.
3) Per-unit yield of cotton in southern Xinjiang shows an increasing trend. Cotton has relatively guaranteed returns compared to other agricultural products, and the expectation is that cotton acreage and production will increase next year.
II. American Cotton
(1) Positive Factors
1) Fund adjustments. As of December 10, the net long position of funds reached a historical low of -8% for the same period. Extremes tend to reverse. Funds may lack short selling ammunition later, increasing the probability of a rise in net long positions.
2) Up to now, 60% of India's daily listed cotton has entered CCI, with a cumulative purchase of about 500,000 tons. Continued purchases by India are expected to alter international trade flows.
3) Farmers' support for prices. Judging from the 03 contract's on-call, farmers' willingness to support prices is strong.
(2) Negative Factors
1) If Trump returns to power, he may increase tariffs on Chinese clothing, which is expected to reduce demand for American cotton.
2) Brazil is highly likely to increase production next year, indicating that current prices have not reduced next year's acreage.
3) Current demand for American cotton remains weak, and Southeast Asia's operating rates are slowly declining week by week.
Points to Watch: China-US Relations

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Tongzhou Cotton Market Brief, Week 4 of December 2024

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Tongzhou Cotton Market Brief, Week 1 of December 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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