Where will Xinjiang cotton prices go? Buyers have different opinions
October On the 24th, the price of seed cotton in Korla, southern Xinjiang, continued to fall. On that day, the purchase price of hand-picked cotton with 40% clothing score was 7.0-7.30 yuan/kg, a decrease of 0.10 yuan/kg from yesterday; the mainstream price of machine-picked cotton with 40% clothing score was 6.20-6.30 yuan/kg, down 0.05 yuan/kg. According to feedback from cotton farmers in Kashgar, Aksu and other places in southern Xinjiang, the recent price of hand-picked cotton with 37-38% clothing content in Kashgar is 6.9-7.0 yuan/kg, and the price of hand-picked cotton with 36-37% clothing content in Yarkand is 7.0-7.2 yuan/kg. yuan/kg, with a decrease of 0.10-0.15 yuan/kg. Coincidentally, the price of seed cotton in northern Xinjiang also fell. On the 24th, the price of 40% hand-picked cotton in Bozhou area was 6.5-6.7 yuan/kg, and the price of 39% hand-picked cotton in Tacheng area was 6.70-6.8 yuan/kg. According to cotton farmers, as of now, seed cotton harvesting in northern Xinjiang has basically ended, but the sales progress is relatively slow, with only about 40% completed.
Affected by the falling price of seed cotton, the cotton market in Xinjiang can be said to be full of happiness and sadness. On the same day, the person in charge of a mainland bag factory in Aksu said that their factory has been suppressing the purchase volume since the scale was opened in early October, and now it seems that it is on the right track. The person in charge said that their factory currently sorts more than 1,200 tons of cotton, with an average cost of 15,900 yuan/ton. In recent days, due to the decline in seed cotton prices, the cost of lint cotton has dropped to the first line of 15,100-15,200 yuan/ton. While the cost of lint cotton has declined, the sales price of lint cotton has dropped to about 16,000 yuan/ton (the delivery price from the supervision warehouse). The cotton sorted out in the early stage is basically There is no profit. Recently, Xinjiang Cotton has finally made a few hundred yuan in profit.
However, some cotton companies that made early acquisitions and sorted things out quickly are under great pressure. Because a certain company is optimistic about the market outlook, it has been open to purchasing since the scale was opened. So far, it has sorted nearly 5,000 tons of lint cotton, with an average cost of about 16,000 yuan/ton (due to the rush to harvest, the purchase price of seed cotton is relatively high). The current cost and sales price are basically the same. The person in charge of the company said that if the price of lint continues to fall in the near future, they will fall into a loss situation.
With the fluctuation of seed cotton prices, the differences among some market entities have increased. From the end of September to early October, the market was overwhelmingly bullish, but now the bears and bulls are evenly matched.
Bears believe that the recent intensive listing of seed cotton has suddenly increased market supply. As cotton farmers’ reluctance to sell weakens, cotton supply may become congested. Others are the negative purchasing attitude of downstream cotton-using enterprises and the recent decline in cotton yarn prices, which have also put pressure on the lint market.
Bulls believe that cotton production will drop significantly this year. Although most textile companies rushed to reserve cotton before September 30, many companies have already experienced a shortage of raw materials. It is estimated that there may be one or two small purchase peaks in the near future, which will bring benefits to cotton prices.
Recently, the cotton market has been mixed with bulls and bears, and the market direction is confused. As a market subject, we should be cautious and cautious.
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