Textile demand is strong, cotton prices continue to rise(1)

Update:05 Mar 2021
Summary:

In January, demand in the textile industry continued to […]

In January, demand in the textile industry continued to be strong, and sales of finished products were smooth. Textile companies were more enthusiastic about purchasing and replenishing cotton raw materials. Domestic cotton prices continued to rise, but the growth rate narrowed compared with the previous month. Finished yarns, viscose and chemical fibers, etc. Product prices have also risen to varying degrees. In the same period, international cotton prices fluctuated and rose. During the period, affected by the news that the United States banned the import of Xinjiang cotton, the rate of increase was lower than that of the domestic market. At the end of the month, the spot price gap between domestic and foreign cotton increased slightly.
1. Changes in domestic and foreign spot prices
1. Domestic spot prices keep rising
In January, the last month before the Spring Festival, the domestic new cotton purchase and processing work continued, and the market has abundant cotton resources. The purchase and sales of the textile industry are relatively hot, and downstream orders have increased, and the lint spot is actively purchased. During the month, domestic cotton spot prices continued to rise, but the increase slowed compared to the previous month. At the end of the month, the China Cotton Price Index (CCIndex3128B) was 15,243 yuan/ton, an increase of 280 yuan from the end of the previous month, an increase of 1,410 yuan year-on-year; the monthly average price was 15,277 yuan/ton, an increase of 484 yuan month-on-month, an increase of 1,450 yuan year-on-year.
2. The price of long-staple cotton has risen
In January, the textile industry's demand for long-staple cotton improved, the sales volume of long-staple cotton increased significantly and the price rose. At the end of the month, the transaction price of 137 grades was 21,500 yuan/ton, an increase of 200 yuan from the previous month, which was higher than the China Cotton Price Index (CCIndex3128B) of 6,257 yuan in the same period, and the price difference narrowed by 90 yuan from the end of the previous month.
3. International cotton prices fluctuate upwards
Global vaccination continued in January. International cotton prices fluctuated upwards at the beginning and the middle of the month, and fell slightly at the end of the month, and the overall price rose from the previous month. China's imported cotton price index FC Index M was 88.6 cents per pound each month, up 5.6 cents from the previous month. At the end of the month, it was 87.41 US cents/lb, higher than 1.39 US cents/lb at the end of the previous month. The 1% tariff was reduced to RMB 14065/ton, which was lower than the domestic spot price of 1178 RMB/ton during the same period. The price difference between domestic and foreign cotton increased by 134 yuan from the end of the previous month.
4. The downstream of the textile industry continues to improve, and the price of finished products rises
In January, the downstream demand of the textile market continued to improve, the order volume increased sharply, and the sales price of textile finished products increased. Specifically, the month-end transaction prices of pure cotton yarn KC32S and combed JC40S were 24,080 yuan/ton and 28,580 yuan/ton, up 380 yuan and 1,480 yuan respectively from the end of the previous month; polyester staple fiber was 6,150 yuan/ton at the end of the month, up from the end of the previous month. 300 yuan, viscose staple fiber was 13,500 yuan/ton at the end of the month, an increase of 2,500 yuan from the previous month.