Market Analysis: Cotton Yarn Is Easy To Rise But Difficult To Fall In 2922

 

 

Due to the influence of high cost and low profit, some textile and clothing orders have been lost in the fourth quarter of 2021. However, with the price of textile raw materials rising, the enthusiasm of downstream enterprises to prepare goods before the Spring Festival is improved. At the same time, enterprises receiving orders in the early stage after the festival are faced with the demand of replenishment, which supports the improvement of cotton yarn market orders. According to the survey, the cotton yarn orders of some cotton spinning enterprises have reached the end of February, and the orders are expected to continue in the peak season of gold, silver and silver. However, as the peak season recedes, there is a risk that orders in May will fall back. Close attention should be paid to the start-up and replenishment progress of downstream cloth mills in the short term.

 

In 2021, China's textile and clothing exports have made remarkable achievements, and the growth toughness is relatively sufficient. According to the latest data of the General Administration of customs, in 2021, China's textile and clothing exports amounted to 315.466 billion US dollars, an increase of 8.38% year-on-year and 16.17% higher than that of 2019. Among them, the textile export volume was 145.203 billion US dollars, a year-on-year decrease of 5.6% and an increase of 20.80% over 2019; Clothing export volume was 170.263 billion US dollars, up 24.0% year-on-year and 12.48% higher than that of 2019. At present, China's textile and clothing export market is relatively stable, with sufficient growth toughness, and is expected to maintain stable growth in 2022.

 

According to market monitoring, the inventory days of pure cotton yarn products of cotton spinning enterprises above designated scale in January averaged 38 days, an increase of 3 days compared with the previous month; The average inventory days of pure cotton grey fabric finished products of weaving factories above designated size was 42 days, an increase of 3 days compared with the previous month. In January, the production of textile enterprises was normal, and the spot price of cotton futures rose. Cotton textile enterprises maintained the shipment of old customers, and the transaction of new orders improved slightly. The accumulation rate of gauze stock slowed down, and the prices of some products rebounded. In the later period, we paid close attention to the arrival of orders and cotton price trend after the festival. It is expected that the domestic cotton yarn market will rise in the next three months, and the price fluctuation range of 32 high-end combed cotton yarn will be 29000-31000 yuan / ton.

 

From the perspective of raw materials, in January, the US Department of agriculture monthly supply and demand report reduced the US cotton production, the US cotton warehouse to sales ratio decreased, while Vietnam, Pakistan and other countries had strong cotton import demand, and it is expected that the trend of American cotton will remain strong after the festival. In February, Xinjiang cotton ginning plant has little pressure to repay the loan, and the situation of price rising and price sparing will continue, which has certain support for the trend of Zheng cotton. From the supply side, most textile enterprises have returned to work. Some textile enterprises with more employees from other places plan to return to work around the 15th day of the first month. Trans provincial logistics transportation and downstream weaving enterprises will gradually return to normal around the 15th day of the first month. The holiday and resumption time of some enterprises are determined according to the epidemic control policies and orders after the festival. From the demand side, if there is no emergency, the opening time of textile and clothing trading market is mostly set around the 10th day of the first month, and the resumption time of weaving enterprises is relatively normal. Due to the low stock of raw materials, there is a demand for cotton yarn just to be replenished after the festival.

 

To sum up, the current domestic and foreign cotton prices have risen to a ten-year high. Although the downstream transmission of cotton price rise is not smooth, the geopolitical risk is upgraded, the crude oil market is strong, and the rising trend of bulk commodities is good. After the festival, the downstream textile market will usher in the traditional peak season. It is expected that the spot price of domestic cotton yarn in the first quarter is easy to rise but difficult to fall. In the later stage, we should pay close attention to the expected fulfillment.