According to feedback from cotton trading companies in Qingdao, Zhangjiagang and other places, since mid-February, domestic cotton textile companies and traders have paid more attention to and inquired about Australian cotton in 2021/22 and 2022/23 than in the previous period. Bonded cotton, customs clearance The activity of cotton shipments has increased, especially for high-quality and high-index Australian cotton such as SM 1-3/16 and SM 1-7/32. The recovery is relatively obvious.
A medium-sized cotton import company stated that since late January, the amount of 2022 Australian cotton arriving in Hong Kong has continued to increase compared with November/December, and the quality of cotton resources is better than that of previous shipments, with lower impurity content and short lint rate. , a strong substitute for medium-staple cotton and long-staple cotton, but currently, whether a small amount of 2019/20, 2020/21 old cotton or 2022/23 new cotton resources are concentrated in the hands of several large cotton companies, although buyers choose The cargo space is getting larger and larger, but the bargaining space is not outstanding compared with US cotton, Brazilian cotton, etc., and traders prefer “fixed price” sales.
Why is the rebound momentum of Australian cotton inquiries and transactions relatively obvious? Industry analysis is also related to the following three factors:
First, with the main ICE contract falling back to the 80-85 cents/pound range, the price competitiveness of Australian cotton has rebounded. For example, the current quotations of bonded Australian cotton SM 1-5/32 (strong 29GPT), SM 1-3/16 (strong 29/30GPT), SM 1-7/32, and SM 1-1/4 in China’s main port are 101 US dollars respectively. cents/pound, 102 cents/pound, 103 cents/pound, 104 cents/pound; and the quotation of US cotton 31-3/31-437 (including EM, strong 29GPT) also reached 101.65-103.65 cents/pound. The quotation price of Brazilian cotton M 1-5/32 is 99.80-101.50 cents/pound.
Second, after the Spring Festival, a small number of high-count and high-value-added export orders were gradually issued. In order to save costs and increase profit margins, spinning mills purchased high-index 2021/22 Australian cotton to replace medium-staple cotton or long-staple cotton. Distribution factories and cotton yarn middlemen in Jiangsu and Zhejiang have reported that orders for carded/combed yarn with a count of 60S and above have picked up compared with before the Spring Festival, although short orders and small orders are still high.
Third, the industry’s concerns about the supply of high-quality and high-index U.S. cotton in 2022/23 are difficult to eliminate. However, in 2021/22, Brazilian cotton has declined in cost performance due to price hikes by exporters and traders. In addition, Brazilian cotton is SM grade and above, The proportion of lengths above 1-5/32 is relatively low, so Australian cotton has become an important option for Chinese buyers.
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