How Much Trouble Has India Cotton Brought To The "Cotton Trading" Incident?

Since late December, the quotations for January S-6, 1-5/32, S-6 1-1/8 and BCI 1-1/8 have been stabilized at 76.70-76.90 cents / lbs, 76.40-76.60 cents / lbs and 77.50-77.70 cents / pounds (CIF); while December, the quotations for MCU and CIF are in the cent / pound and cents cents / pound; the difference between January and the same period in the January period is up to a cent / pound, but still below the average price of 10 cents per pound in January.

Traders in Shandong, Jiangsu and other places estimate that after mid January, there will be 2016/17 EMOT and India cotton S-6 arriving in succession, while the GM and SM grade Ukrainian cotton must wait until the end of January.

According to the quotations from several foreign businessmen and importers, the shipping dates of S-6, J34 and DCH32 were postponed to 1/2 in December except for MCU5 in India cotton. However, as at the end of December, only a small amount of India cotton arrived in Qingdao (Guangzhou, Zhangjiagang) and so on.

Industry analysis: on the one hand, the impact of India's new monetary policy on the industrial chain is still fermented. The progress of seed cotton sale and the rate of start-up of cotton ginning workers are seriously lagging behind, and the domestic cotton mill has to sign the import 2016/17 year.

In the "pition", the export contracts for shipment and delivery in December were "wasted". The buyer could only cancel the contract or postpone shipment. On the other hand, because of the strong expectation of a significant depreciation or sustained depreciation of the RMB, some foreign and overseas ginning mills and exporters were not eager to ship the goods ahead of time, but rather "dragging them away".

The author believes that India cotton will continue to decline in 1 and February, and the export competitiveness of gauze will be further enhanced.

1. The State Food Security and Research Department of Pakistan has recently said that India cotton will be exempted from duty free until all the new cotton sales are completed in China.

This is the first official statement made by the Pakistani government since the end of November that Pakistan ceased issuing customs import licenses to India cotton. At least in the short term, India cotton was blocked outside the "gate", and the blow to India ginning factories and manufacturers was self-evident.

Two, India's new cotton market has been postponed and affected by monetary policy. Some cotton mills and middlemen have imported cotton in advance (mainly cotton, cotton in Central Asia and West Africa), which is equivalent to India, which is supposed to supply more than needed.

A "bomb" has been planted, and India cotton will be greatly increased after being pushed to the international market.

Three, the US stock index and the US dollar index rose and the Federal Reserve raised interest rates. The expansion of the rupee depreciation rate in India was a great success for cotton and cotton yarn exports.

Therefore, it is foreseeable that the price difference between India cotton and American cotton will continue to widen in 2017, Vietnam, Bangladesh, Indonesia and so on.

"Abandoning American cotton and buying India cotton" is stronger than expected.

According to some cotton traders in Qingdao, 12 International Cotton Traders and large and medium-sized import enterprises in China started to "reserve" better bonded warehouses (easy to get in and out goods and moderate storage prices) in the middle of next month. Some bonded warehouses and interim warehouses also actively clean up and straighten out cotton and so on, and wait for 2016/17 cotton to arrive and store in the new year.

But cotton business is basically the same as 2015/16 operation this year. The sales focus is on the sailing date and spot shipment of cotton in the far months. As far as possible, the amount of bonded volume can be reduced. On the one hand, the prediction of China's cotton import volume in 2016/17 will not exceed 1 million 100 thousand tons (2015/16 only imports 960 thousand tons) on the one hand.

In 2017, according to the Chinese government's accession to the WTO, it promised to issue a 1% tariff import quota of 894 thousand tons, plus about 15-20 tons of "extended" quota, with a total volume of 105-110 million tons; on the other hand, China's port charges were on the high side.

Such as storage in Southeast Asia ports (such as Klang, Hu Zhiming, etc.) not only lower storage costs, but also be able to pfer to Hong Kong at any time. After all, the focus of global cotton imports and consumption has shifted to Southeast Asian markets such as India and Vietnam since 2014.

For more information, please pay attention to the world clothing shoes and hats net report.