Market Trends: The Overall Situation Of Cotton Yarn Sales After The Festival Is Still Sluggish

After the May Day holiday, although the sales of low count cotton yarn slightly recovered, the overall situation was still sluggish. Market demand is intermittent, and orders are difficult to form a sustainable and stable growth trend. As of May 9, the spot reference price of 21S pure cotton ring spinning in Shandong was about 22265 yuan/ton, which was the same as before the festival; The spot reference price of 32S pure cotton ring spinning is about 23775 yuan/ton, which is the same as that before the festival.

Market overview: After the festival, although the sales of low count cotton yarn has slightly warmed up, the overall situation of the cotton yarn market is still depressed. With the advent of the traditional sales slack season, the market demand is intermittent, and orders are still small and short, which is difficult to form a sustained and stable growth trend. The purchasing enthusiasm of downstream enterprises continues to be depressed, and the wait-and-see mood is strong. In order to prevent inventory pressure, the enterprise has a positive attitude towards shipment, and the actual transaction price of yarn has decreased slightly.

Startup: Due to the limited downstream demand, some small and medium-sized textile enterprises take turns off and off peak startup to reduce the finished product library. The startup rate is basically stable, with about 90% of Xinjiang textile enterprises starting up and 6-70% of mainland enterprises starting up. As of May 8, the startup load of textile enterprises in mainstream regions was 74.4%, unchanged from that before the festival. It is expected that the startup rate will be lowered next week.

Inventory status: with the end of the holiday, downstream customers began to gradually release their demands, and some orders were issued in succession, mainly small orders for turnover. However, the overall domestic and overseas market demand is still weak compared with the same period in previous years. Some large factories and warehouses in Xinjiang have existed for about 35 days, and mainland enterprises have existed for about 20 days. As of May 8, the yarn inventory of textile enterprises in major regions was 29.3 days, down 1.68% on a weekly basis.

On the cost side: this week, the cotton rush rose and fell, while Zheng Mian's shock was strong. In terms of spot goods, there is a shortage of new orders in the downstream after the festival, the willingness to replenish stocks is weak, market inquiries are reduced, and there is a strong expectation that consumption will weaken significantly in the later period of the country. Zheng Mian is under obvious pressure, and it is expected that cotton prices will fluctuate in the next week.

Weak demand: the cotton grey cloth market continues to run in a weak position. The weak terminal demand has led to the weakness of the textile factory in order acceptance, and the new orders in the domestic and foreign markets are insufficient. At present, small batch and multi batch orders are mainly used, and the production proportion of conventional varieties has increased. Affected by the imbalance between production and sales, grey fabric inventory shows a slow accumulation trend, and some textile mills have reduced the start-up load. The price system remained stable, but there was bargaining space for actual transactions. With the arrival of the traditional off-season, weaving mills generally adopt the cautious strategy of "buy as you use".

Future market forecast: With the end of the traditional sales peak season of "Golden Three Silver Four" and the market entering the slack season of demand, the current cotton yarn market order situation is becoming more complicated and confusing. Affected by this, all sectors of the industry have insufficient confidence in the future market and generally hold a cautious wait-and-see attitude. From the price perspective, although the surface price of cotton yarn remains stable, there is actually a hidden downward trend. Based on this, it is expected that the cotton yarn price will be blocked in the short term, and the subsequent price trend will largely depend on the speed and digestion of finished product inventory during the off-season.