Last week, international cotton prices rose, driven by institutional investors, and the arrival of Hurricane Ida over the weekend also contributed to the situation. The Federal Reserve’s final decision relieved the financial market. However, after Hurricane Ida landed in the United States on Monday, the threat to new American cotton weakened, and prices immediately fell.
The rise in cotton prices in China and India is affected by rising ICE futures on the one hand and low domestic seasonal stocks on the other. At the same time, problems with cotton logistics and transportation have also led to a significant increase in procurement costs for cotton mills. On the one hand, freight rates have increased, and on the other hand, delivery has been repeatedly delayed, which has intensified market tension. Despite the tight supply, in fact, the demand for replenishment of yarn mills is far from being significantly released. Currently, yarn mills are facing a slowdown in sales and are difficult to raise prices.
In the recent price rise, countries that rely purely on imports such as Bangladesh, Vietnam and Pakistan have been more affected than China and India. As cotton prices continue to rise, the profits of cotton mills have also begun to decline. This has occurred in countries such as Vietnam, Bangladesh, and Pakistan. The spot price of cotton in Pakistan has risen to a new high of 14,100 rupees/maund, while the new crown epidemic continues to Manufacturing in various countries has caused troubles, and Vietnam has been hardest hit. The country’s long blockade has delayed product export deliveries to the United States, and many goods have missed year-end holiday sales. Although many factories can still operate to varying degrees, the ban on entry and exit in Ho Chi Minh City has caused great challenges to transportation, and goods have been backlogged for a long time.
Although there is a tight supply situation in the short-term international market, the industry situation in Southeast Asian countries is worrying. The current epidemic will still have a profound impact on the latter part of this year and the next year. Asian countries There are many problems in the textile supply chain, and the market needs to be cautious about the long-term trend of cotton prices. In the short term, ICE futures are facing greater resistance at 95 cents. If there is no production reduction due to extreme bad weather during the harvest period, U.S. cotton production will be close to 18 million bales. </p
