Cotton Prices Fall Or Fall Again, Cotton Enterprises Give Up Orders To Enter The Off-Season Industry In Advance.

In March 31st, the eight departments of the national development and Reform Commission jointly issued the 2011 year.

The cotton growers' cooperation committee of Cotton Association of China Cotton Association conducted a survey on the sale of more than 1700 cotton growers in 12 provinces and cities in the mainland. The survey showed that the spot price of cotton began to decline in March, and the purchase price of seed cotton also fell. Cotton farmers were not satisfied with the price. Cotton enterprises thought that the market outlook was uncertain, and the acquisition market basically stagnated.

Mr. Zhao of Foshan Feng Cai Cotton Textile Co., Ltd. told reporters that after the Qingming period, the new cotton planting period is also the traditional off-season of the cotton industry. But this year, the industry is depressed, and it has already entered the off-season in March.

At present, his company is still actively expanding its business. "We are all engaged in domestic business, but now many of our customers are turning to foreign trade. The cotton textile products they produce are sold abroad, and there are still some orders to do."

He reluctantly indicated that if the company wants to really improve, it can only wait for the macro market situation to change.

The announcement of the purchase and storage plan has given the cotton farmers a "reassurance", and has further increased the market risk of cotton enterprises. Cotton enterprises must sell their cotton and yarns at an ideal price before this year's new cotton listing, in order to avoid a bigger loss.

Mr. Zhao pointed out that the company now has a lot of reduction in output. In 2010, seed cotton price was more than thirty thousand yuan per ton, and this year it dropped to more than 20000. There are still many stocks. If the remaining months are not dealt with, the loss will be even more serious.

Data show that the price of low cotton yarn products is close to that of high grade cotton, and the yarn production of some textile mills has been at a loss.

Small textile enterprises that made cotton yarn earlier have cut down or stopped production because of poor yarn sales.

Hedging and reducing losses

Reporters learned that many cotton enterprises have hedged cotton pactions.

A person in charge of a cotton enterprise in Chizhou, Anhui, told reporters that the company had hedging the Zheng cotton 1109 contract. This year, the phenomenon of "pressure warehouse" is serious, so hedging is especially necessary.

It is estimated that cotton prices will fall again in the year. The company is mainly involved in selling deliveries this year. "We are predicting a serious decline this year and selling hundreds of hands at around 09 zhengmian 25000."

Yesterday, Zheng cotton 1109 contract opened 27640 yuan / ton, closed at 27810 yuan / ton, compared with the previous trading day rose 20 yuan / ton.

28000 yuan / ton is regarded as the cost line by the cotton trading market. Dongxing futures indicated that the overall commodity market's downward trend has not been completed, and cotton is unlikely to rise independently.

Tan Yanwen, Professor of the Department of Agricultural Economics and management at South China Agricultural University, pointed out that cotton producers are still producing cotton. This year's output is expected to reach a new high. If prices continue to fall, cotton farmers will lose more.

There is still a gap in the domestic cotton market, but the price is not rising or falling. He believes that the main reason is that market information is opaque, cotton farmers or cotton enterprises can not understand their own situation. The government should set up an early-warning mechanism as soon as possible to avoid market turbulence.

Guangdong Cotton Textile Association pointed out that there is no obvious demand in the international cotton market at present. It is suggested that foreign trade enterprises should seek new customer sources as early as possible, and expect that the Canton Fair will be able to inject power into the market.