Production is still recovering and prices are stable but strong
Since mid-February 2020, cotton futures and spot prices at home and abroad have fluctuated and fallen. cotton yarn product prices have generally increased slightly. Driven by the increase in cotton yarn prices, gray fabric products have been stable and strong. .
01
Raw material market
Since mid-February, although the domestic epidemic prevention and control situation has gradually improved, the number and scope of infections abroad have rapidly expanded, panic has spread in the internationalcommodity market, and domestic and foreign cotton futures, Spot prices fluctuated and fell sharply. On March 12, the closing price of Zheng Cotton’s main contract was 12,150 yuan/ton, a new low, down 1,000 yuan/ton from the high in the past month; the domestic 3128B grade cotton quotation was 12,510 yuan/ton, down 800 yuan/ton from the same period last month. Around tons. In terms of cotton yarn, due to the lack of stockings by weaving companies before the year, and the urgent need for purchase by companies that resumed work at the end of February, coupled with the shortage of cotton yarn supply in the market, the price of cotton yarn rose slightly, with most conventional varieties rising by about 150 yuan/ton compared with the same period last month. In the situation of unclear market conditions, textile enterprises mainly purchase products as they are used.
02
Grey cloth market
As weaving companies resume work more and more, pre-holiday orders are being produced and shipped one after another. However, there is no significant increase in market inquiries and new orders. Most of the company’s orders are quick orders and short-term orders. Most companies place orders in about two weeks, and some orders Larger enterprises have placed orders until May. According to companies, some export orders have been lost due to the epidemic. March was originally the traditional peak season, but domestic spring clothing sales have dropped significantly this year, and the delivery date of summer clothing is also expected to be delayed. Therefore, downstream gray fabric orders have shrunk. In terms of price, driven by factors such as the increase in cotton yarn prices, the overall price is stable but strong. After companies resume work, the quotations of gray fabric products generally increase by 0.05-0.3 yuan/meter, and the actual transaction prices mostly increase by 0.05-0.10 yuan/meter. Because the production capacity of weaving enterprises in some areas has not been fully restored, the output of gray fabrics is less than that of the same period last year, and product inventories have dropped significantly.
03
Market outlook
Domestic epidemic prevention and control has achieved initial success. The state has successively introduced relevant policies to support the resumption of production of enterprises. The startup rate of textile enterprises continues to increase, and production operations have gradually resumed. However, upstream cotton prices fluctuate, and cotton yarn prices may not continue to rise. Gray fabric prices are under greater pressure to rise. Whether the market can pick up later depends on the start-up and order status of downstream companies.
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