Cotton futures rose again yesterday, cotton prices rose 40% in February
The cotton futures limit of Zhengzhou Commodity Exchange has been rising across the board. In the past two months, cotton prices have risen rapidly. Futures prices have increased from 17,000 yuan / ton in late August to the current more than 26,000 yuan / ton, an increase of up to 50%.
Cotton prices in the spot market have risen synchronously with futures prices. As of October 25, the cotton price index published by China Cotton Information Network reported 25589 points, an increase of more than 40% from the end of August.
Large domestic cotton supply gap
The tight global cotton supply is the basis for the increase in cotton prices. A report released by the US Department of Agriculture in early October predicted that in 2010/11, the global cotton gap would be 890,000 tons. The tight supply situation has caused cotton prices to continue to rise in the international market. New York cotton futures prices have risen since late July, and the cumulative increase so far has been nearly 70%.
According to data from the National Bureau of Statistics, China's cotton planting area and output have declined for two consecutive years. From 2007 to 2009, the cotton output was 7.62 million tons, 7.49 million tons and 6.4 million tons respectively.
Lao Li, a cotton farmer in Wuhan, Hubei, told reporters that "mainly the price of cotton was too low in 2008, and many cotton farmers suffered losses, so their enthusiasm for planting decreased." 10,000 kilograms of cotton were harvested, but the price of seed cotton was only 3.8 yuan / kg at the time, and a total loss of nearly 20,000 yuan was lost, so no cotton has been grown in the past two years. " The purchase price of seed cotton in Wuhan has risen to 10.6 yuan / kg.
In addition to the decline in planting area, extreme weather factors this year have also caused some areas to reduce production.
Capital speculation also boosted cotton prices
Capital speculation is also a major factor in the sharp rise in cotton prices. There are rumors on the market that Wenzhou “fried cotton groups†are actively buying cotton in production areas. According to data released by Zheng Shang, as of October 25, the total position of cotton futures was 487,300 lots. Compared with the same day two months ago, the total position increased by 70%, indicating that funds are continuously flowing in.
At the same time, in order to curb cotton prices, the State Reserve Bureau has sold a total of 1 million tons of reserve cotton to the market since August 10, but it was during this period that cotton prices rose the most. Xinhu Futures analyst Liu Qing said, "The current supply gap is very large, and investors expect that the more the State Reserve Board sells off the reserves of reserve cotton in its hands, so it rushes to buy reserve cotton." The transaction price of the reserve cotton sold also climbed up, from the original 18,000 yuan / ton to 25,000 yuan / ton.
Industry insiders believe that Xinjiang cotton will be listed in large quantities after November, and Xinjiang cotton accounts for one-third of the total domestic cotton output. At that time, the trend of soaring cotton prices may change.
Cotton stocks benefit from home textile pressure
In the course of the substantial increase in cotton prices, the relevant cotton plantation companies have benefited the most. The share of cotton business revenue, which accounts for nearly 70% of the new agricultural development stocks, has risen by 7.91%; Xinsai shares also use cotton as the main business since the beginning of July. Since then, it has risen by 80% in total, with a strong daily limit on October 25.
Contrary to the trend of "cotton stocks", the downstream home textile companies are significantly inhibited by the rise in cotton prices. The stock price of Fuanna, a listed company, has maintained a volatile trend. The second trading day after the National Day showed a sharp decline, although The market continued to rise after the holiday, but the stock fell by more than 11% during this period; Mengjie Home Textiles also maintained a downward trend of shocks, the current stock price is lower than before the National Day; only Luolai Home Textiles has a strong trend, but the current stock price is also It is still below the level before the National Day.
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