Since the end of April 2021, the central parity rate of the US dollar against the RMB has begun to rise. The devaluation of the renminbi has to some extent cushioned the impact of the trade war on textile exporters, which is a boon for the export-dependent textile and apparel industry. If the depreciation trend of RMB exchange rate continues, textile and garment enterprises will get more export orders, and increase enterprise income, improve the gross profit rate of export enterprises.
The domestic cotton output is under great upward pressure, and with the digestion of national cotton storage inventory, the gap between supply and demand of cotton in China may continue to expand in the future. In the medium and long term, the cotton price has an upward trend, which will bring some pressure to the profitability of cotton spinning enterprises
China’s cotton acreage continues to decline, domestic cotton production upward pressure is greater, the future China’s cotton supply and demand gap may continue to expand. In 2021, the sown area of cotton in China was 3.23 million hectares, 120,000 hectares less than last year. The annual cotton output was 4.199 million tons, slightly higher than last year, and the overall trend of output was weak. By September 30, 2021, the rotation of cotton reserves in this year was over, with a total of 4.312 million tons planned to be released, and 2.506 million tons actually traded. With the release of state storage cotton and the decrease of inventory year by year, the gap between supply and demand of cotton in China may continue to expand in the future.
China’s cotton price began to rise in 2021, 2021 to maintain a stable overall, from the middle of May 2021, 328 cotton spot price all the way, including June 19, 2021, the highest point of 16,402.00 yuan per ton, May to June rose as much as 9%. However, in the short term, due to the comprehensive factors such as the listing of new cotton, the increase of yield per unit area and the turnover less than expected, the spot cotton market is depressed, and the short-term upward pressure is greater. Considering, cotton supply and demand gap may continue to expand, in the long term, China’s cotton
Post time: Aug-17-2021