Cotton textile industry as a whole runs smoothly in June

In June 2016, the overall operation of the cotton textile industry was stable, raw material prices rose slightly, and purchases increased; but the downstream market demand was insufficient, export pressure was greater, and production orders were tight; gauze transactions were less and inventory pressure was greater.

I. Rising raw material prices and increasing purchases

In June, domestic and foreign cotton prices continued to rise. As of the 21st, the price index of 3128B cotton was 12,960 yuan / ton, up 0.3% this month. The price fluctuation of cotton of the same grade rose to 75.05 cents / lb, up 3.2% this month, and after a 1% tariff reduction, the price difference between domestic and foreign cotton was about 350 yuan / ton. Driven by rising cotton prices, many companies have increased their purchases. Tracking data show that the purchase of raw cotton in May increased by 2.8% month-on-month. This month, the price of WTI crude oil rose slightly. As of the 20th, it closed at US $ 49.4 per barrel. The price of the PTA market bottomed out and rebounded by 3.8%. The price of 1.4D direct-spun polyester staple fiber rose slightly, rising 0.3%; mainstream viscose short Fiber prices ran high and closed at 13,580 yuan / ton. Tracking data showed that non-cotton fiber purchases increased by 6.9% month-on-month.

Second, the transaction rate of reserve cotton declined slightly, and raw cotton stocks declined

As of June 20, the cumulative volume of cotton traded was approximately 877,000 tons. The volume of imported cotton and domestic cotton was 296,000 tons and 581,000 tons, with transaction rates of 98.16% and 96.74%. Overall, there were only 30,000 per day. The input volume of around tons supports a relatively high transaction rate. As the proportion of imported cotton dropped in June, the willingness of enterprises to buy has weakened, and the starting price has risen. The cost-effectiveness of reserve cotton has been lower than expected, and the sentiment of enterprises to store and deposit has eased. , So the transaction rate dropped slightly. According to the survey, many companies participate in the auction of reserve cotton and use the reserve cotton to replenish their stocks. However, problems such as “difficult to go out of the warehouse” and “slow out of the warehouse” have delayed the arrival time of cotton raw materials, which has led to lower inventory. Tracking data showed that raw cotton inventories fell by 0.05% month-on-month in May. From the perspective of policy guidance, relevant national departments have successively studied and introduced relevant policies and measures to solve the difficulties encountered in the production of reserve cotton wheels, and the China Cotton Association has also been actively striving for relevant policies. It is expected that in the future, driven by rising cotton prices and the purchase of reserve cotton, the companies will replenish their stocks.

Third, the industry runs smoothly and the export pressure is high

It is understood that the overall textile market operation in May was stable, and the output increased month-on-month. Tracking data showed that yarn and cloth production increased by 2.3% and 0.8% respectively. June is the off-season of production, and orders have fallen slightly. According to customs data, from January to May 2016, China's textile and apparel exports totaled 100.63 billion US dollars, a year-on-year decrease of 2.3%. Among them, textile exports were US $ 43.22 billion, a year-on-year decrease of 0.5%; clothing exports were US $ 57.41 billion, a year-on-year decrease of 3.6%. From March to May, the decline in China's textile and apparel exports continued to narrow, showing signs of export recovery. However, as international market demand is still weak, export pressures remain high.

Fourth, gauze sales pressure

In May, cotton prices rose, yarn price transmission effects were not obvious, and market turnover was not high. Tracking data showed that cotton yarns fell by 3.0% month-on-month; affected by downstream warming, shipments of cotton cloths increased and chained prices increased by 5.9 %. In June, the price of cotton continued to rise. As of the 20th, the price of pure cotton yarn CY C32S yarn was 19,675 yuan / ton, a recent high, rising 1.3% this month. The price of cotton yarn has reached a stage high, and cotton cloth CG The price of C32 grey cloth was 5.352 yuan / meter, a slight increase of 0.1%. Gradually entering the off-season, industry sales pressure is still huge.

In May, the price of chemical fiber gauze fell, and many companies increased their sales efforts and increased transaction volume. Tracking data showed that sales of chemical fiber gauze increased by 5.2% and 11.4%, respectively. In June, market transactions were light and chemical fiber gauze was weaker. As of the 20th, CY T32 was quoted at 11,000 yuan / ton, CY R30 yarn was quoted at 18,050 yuan / ton, and CG R30 grey cloth was quoted at 4.481 yuan / ton, down 0.1% and 0.4 respectively. %, 0.07%. The market has not seen a significant pick-up, and shipments are expected to slow down.

V. Tight product inventory

Inventory pressures increased in May. Tracking data showed that yarn inventory increased by 3.3% in May; although cloth inventory fell by 1.75%, mainly due to the concentrated sales of individual large enterprises, the inventory fell significantly. Production gradually entered the off-season in June, reducing inventory has still become one of the effective measures for enterprises to maintain continuous production and operation. The data in this report comes from the China Cotton Textile Industry Association. It tracks companies that account for more than half of the national cotton textile industry's production capacity and is representative of the industry.

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