Xinjiang: Why has the recent sales of hand-picked cotton been faster than machine-picked cotton?
Correspondent from China Cotton Network: Since mid-January, as the CF1705 contract has repeatedly oscillated in the range of 15,000-15,500 yuan/ton, mainland cotton textile mills and traders have inquired Prices and deliveries have decreased. The official quotation of 3128/2128 hand-picked cotton in southern Xinjiang is 15,200-15,400 yuan/ton. The official quotation of “double 28/double 29” hand-picked cotton is 15,500-15,800 yuan/ton. The official quotation of “double 28” hand-picked cotton in northern Xinjiang is 15,500-15,800 yuan/ton. The public price of cotton is 15,300-15,500 yuan/ton.
Some mainland buyers said that although on the surface, the quotations from foreign merchants and traders are 200-300 yuan/ton higher than those of local cotton enterprises in Xinjiang, due to the loading and unloading contract of the supervision warehouse in Xinjiang, Fees, storage fees and public inspection fees are paid by the seller, and traders’ quotations can generally be reduced by 50-100 yuan/ton through negotiation. The actual final net transaction price is not very different from the market price.
It is understood that due to the better length, horse value and breaking strength of some machine-picked cotton in northern Xinjiang, the premium rate of futures warehouse receipts is relatively high (the basis difference is concentrated at 500-700 yuan/ton). Therefore, traders’ quotations are generally higher than those of hand-picked cotton in southern Xinjiang. Because mainland fabric factories and middlemen still prefer to purchase 3128/2128 and 3129/2129 hand-picked cotton, the transactions and shipments of local machine-picked cotton with “high prices and large impurities” are relatively slow.
It is understood that as of around January 15, all seed cotton purchases in Xinjiang have been completed, and the application for lint cotton storage and public inspection are also nearing completion. Farmers hope that the 2016 cotton target price subsidy will be fully implemented. In order to formulate crop planting plans for 2017.
Cotton companies in Aksu, Bachu, Maigaiti and other places reported that the current stock of lint cotton has generally dropped to less than 15 batches. Only a few cotton companies with multiple production lines still have stocks of more than 1,000 tons, and hand-picked The sales progress of cotton has exceeded 60%, and the overall pressure on enterprises to repay loans and cash flow before the holiday is low. This year’s Spring Festival comes early and road and rail transportation are not efficient. Therefore, sales progress is fast but shipments out of Xinjiang are lagging behind. Not only are mainland buyers anxious, but cotton companies in Xinjiang are also thinking of various ways to ship goods quickly and collect payment as soon as possible. .
The sales situation of other lint cotton moved to the mainland supervision warehouse is not ideal (cotton companies mostly give priority to shipping high-quality cotton such as “Double 28/Double 29” to the mainland). Judging from the time, in late February It is unlikely to replenish the inventory before, but on March 6, reserve cotton began to be rotated out in large quantities, which collided with Xinjiang cotton sales, and the risk increased.
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