1. Price quotes
On the 6th, the price of 32 cotton yarns in Shandong was around 26267 yuan/ton, up 2.34% month-on-month and 30.03% year-on-year.
2. Market analysis
Recently, cotton yarn has been affected by the high rise of Zhengzhou cotton and cotton yarn futures, the rising cotton spot market, and the increase in the replenishment of textile enterprises. The cotton yarn market has also been rising simultaneously. Inventory declines, cotton yarn companies’ shipments are temporarily stable, and cotton yarn companies have a strong willingness to keep up prices, providing motivation for high cotton prices. Cotton yarn futures consolidated at a high level this week. The price rebounded and rose on June. The settlement price was RMB 26,965/ton, and the closing price was RMB 27,180/ton, up 1.38% from the previous trading day.
After the upstream cotton rose at a high level in the previous period, it consolidated and corrected this week. On August 6, China’s cotton price index was 3128B grade 17,528 yuan/ton, down 1.14% from last weekend. Zhengzhou Cotton has been adjusted back due to the expansion of the domestic epidemic, but the downstream demand is optimistic, and the overall market is still strong. The sales of reserve cotton have been well received by enterprises. As of August 6, the total transaction volume was 238,380.64 tons, with a transaction rate of 100%. The market maintained a bullish mentality.
3. Downstream industry chain
After August is the traditional peak season for order placement and production in autumn and winter. The price increase of cotton yarn is not transmitted to the grey fabric end smoothly, which makes the downstream acceptance not high, and the fabric factory maintains just need to purchase. The inventory of downstream fabric companies has not accumulated significantly. After this period of significant rise in cotton prices, the acceptance of raw material price increases will increase. When the peak season comes, the downstream may increase the purchase of raw materials, and cotton yarn will continue to rise in price.