Recently, the center of gravity of cotton futures has shifted upward, and some yarn mills have reported that the pace of shipments has accelerated slightly, and the operation of the industrial market is expected to be better than expected
In 2023, the national cotton output in 24 is expected to decrease by about 1 million tons compared with the previous year, and the first reserve cotton wheel in 2023 will be 88470,000 tons, 750,000 tons of cotton import sliding tax issued, import volume increased significantly year-on-year. New cotton processing, warehousing speed has slowed down, part of the Xinjiang supervision warehouse daily warehousing reservation has dropped to the minimum level, mysteel agricultural product statistics, as of December 8, domestic cotton commercial inventory of 374180,000 tons, 45 more than the same period in 202290,000 tons.
USDA's latest December supply and demand report estimates global cotton production in 2023 24 at 245850,000 tons, down 11 percent from the November estimate80,000 tons, a decrease of 810,000 tons from 2022 23. USDA lowered global cotton consumption in 2023 24 by 3430,000 tons, with an inventory-to-consumption ratio of 7245%, which is slightly looser than the October and November data. At present, imported cotton still has advantages, the amount of arrivals is more, China's port outside the cotton inventory backlog, speculation or is in progress a certain number of imported cotton wheels, to increase the domestic cotton supply plays a two-pronged role, the medium and long-term overall security is guaranteed.
Figure 1 Statistics of China's cumulative exports of textiles and apparel from 2019 to 2023.
According to customs statistics, China's textile and apparel exports in November amounted to 2366.5 billion US dollars, a year-on-year decrease of 296%；Among them, textile exports 111$2 billion, a year-on-year decrease of 130%, clothing and clothing accessories export 125$4.5 billion, a year-on-year decrease of 438%。From January to November 2023, the cumulative export of textiles was 1,233US$6.3 billion, a year-on-year decrease of 92%；The cumulative export of clothing and clothing accessories was 1451$9.8 billion, a year-on-year decrease of 86%。In terms of data comparison, China's textile and garment export data is unsatisfactory, the main export market has shrunk significantly, in other words, foreign textile and garment inventories are at a relatively low level, waiting for the global economy to resume growth, China's foreign trade has a large room for growth.
In the first half of 2023, the start-up of domestic yarn mills will maintain a high level, and most of the factory products will have no inventory pressure, however, according to the analysis of the quarterly report of listed companies, from the first quarter to the third quarter of 2023, the quarterly inventory turnover days of Heilan Home, Jihua Group, SAINT ANGELO, Joeone, Hongdou Co., Ltd., Youngor and other garment companies have increased continuously, and the quarterly inventory turnover rate of most enterprises is less than 2%. The 2023 "Double 11" e-commerce sales data has not been released, and data from the National Bureau of Statistics shows that the cumulative value of online retail sales of physical goods in October 2023 is 103 trillion yuan, a cumulative increase of 84%, of which, food physical goods increased by 113%, and the use of physical goods increased by 84%, while physical goods grew by only 76%, which is below average.
Figure 2 Statistics of the weekly start-up rate of Chinese textile enterprises in 2023.
In late November, cotton prices continued to fall, the cost of cotton used by textile enterprises declined, and some factories started to rebound, mysteel agricultural product statistics, as of December 8, the national textile enterprise operating rate was 672%, an increase of 7 percentage points from mid-November, and some yarn mills said that the recent cotton yarn shipments have accelerated compared with November. In early December, the center of gravity continued to move upward after the cotton price bottomed out, and some yarn companies chose to sell goods for the return of funds, and the start-up of downstream cloth factories improved, according to the data of the Ganglian, as of December 8, 2023, the operating rate of weaving mills in the country was 402%, which has been increased for two consecutive weeks.
To sum up, the cotton industry market challenges and opportunities coexist, and it is expected that the enterprises or plans for the early Spring Festival holiday will change.