Market Observation: Cotton Prices At Home And Abroad Are Weak

There was no obvious change in the cotton industry chain last week, the upstream supply continued to increase, the downstream demand did not improve significantly, and the cotton prices at home and abroad were weak. According to the commodity market analysis system of the business community, as of November 4, the spot price of 3128B lint was 15382 yuan/ton, with a weekly decline of 0.5%.

Domestic market: According to the survey data of the national cotton market monitoring system, as of October 31, 2024, the national new cotton picking progress is 85.2%, an increase of 8.5 percentage points year on year; The national sales rate was 87.0%, up 20.8 percentage points year on year; As of October 31, the national processing rate was 39.4%, down 10.5 percentage points year on year. As of October 31, the national ginning plant operating rate was 97.93%, a slight decrease of 0.22% on a weekly basis. The turn-on rate of Xinjiang ginning plants continues to maintain a high level. At present, the acquisition work in the northern Xinjiang region has basically ended, while the southern Xinjiang region is still in the middle and late stages. With the continuous increase of new cotton listing, the pressure on the supply side has increased.

International market: ICE American Cotton once fell below the 70 cent mark last week, and rose slightly last Friday to close at 70.17 cents per pound, a weekly drop of 0.49 cents per pound, or 0.7%. Although the export contract signing and shipment of American cotton continued to recover last week, the fundamentals were not good, external macro risk factors were improved, and the market trend of American cotton was weak.

Downstream demand: As of October 31, the startup load of textile enterprises in mainstream regions was 72.5%, with a month on month decrease of 0.68%. The yarn inventory of textile enterprises in major regions was 23.9 days, with a month on month decrease of 5.91%. As the traditional peak season comes to an end, orders in the downstream market continue to decrease. Textile enterprises report that new orders are weak, and orders for low and medium count yarns in some regions also decrease. The start-up of small and medium-sized enterprises has declined significantly, and the downstream grey cloth factories purchase on demand.

Future forecast: At present, the market has basically completed the good news on the macro level. From the industrial level, the sale of seed cotton is nearing the end, and the lower acquisition costs are gradually solidified as support. During the peak period of new cotton acquisition, the purchase price of seed cotton is gradually solidified, and the downward space of cotton price is limited. It is expected that the market will remain volatile in the short term.