Cotton: Cost rises and prices fall dramatically and damage the industry

On October 27, 2010, Xinjiang Metropolis Daily “In-Depth Report” stated that “crazy cotton fever is difficult to retreat. How long can cotton prices rise? "The report covers the 2010 cotton market price fever, which has brought great impact to cotton farmers, cotton traders and cotton producers. In the report, cotton farmer Chai Zhigang made money from cotton. Liang Dong, general manager of the Corps Cotton Company, used “crazy” to describe cotton prices. Prof. Liu Weizhong of Xinjiang Agricultural University calmly analyzed that there was no ultimate winner in the face of inflated prices. The price of cotton is a castle in the air. Once the cotton collapses, cotton farmers, cotton companies, textile companies and related industries will eventually suffer heavy losses.

In a blink of an eye, a year has passed, and the cotton harvest season has returned. What is this year's cotton market? Starting from the beginning of this year, the soaring cotton prices began to fall, and many cotton spinning companies seem to be riding a roller coaster. Last year, their profits climbed to the highest point in 10 years. This year, the cotton price plummeted and sighed. On March 28th, the state reserve cotton that had been rescued when the price of cotton soared once again shot up and designated the price for storage and storage in 2011 at 19,000 yuan per ton (seed cotton price was about 8.5 yuan per kilogram), which seemed to be far removed from cotton farmers. The expected difference is too far. In September, cotton acquisition companies throughout Xinjiang began to purchase, and prices have been hovering around 8.5 yuan per kilogram. On September 23, the price of Xinjiang cotton released by China Cotton Information Network was 8.66 yuan per kilogram. In September last year, the average cotton price was 9.46 yuan, and the average price in October was 11.6 yuan. What will be the impact of the rapidly falling cotton price on cotton farmers? What are the impacts on the textile enterprises in cotton producing areas? One year later, reporters from the Xinjiang Metropolitan News once again sought out cotton farmers, cotton companies, and cotton merchants who played in the cotton market.

The cost rises and the price goes down. "You are interviewing every day. There are more information to know. The price for these two days is eight eight. Do you say I sell or not?" On September 23, when the Xinjiang Metropolitan Daily reporter and Shawan County again When the farmer Chai Zhigang contacted, he had just finished weighing the pickers. A call from a reporter, Chai Zhigang immediately inquired about the price information, and in an interview last year, Chai Zhigang waited for a price increase like cotton.

Chai Zhigang told the Xinjiang Metropolis Daily reporter that in 2010, he planted 200 mu of cotton and received more than 60 tons of seed cotton. The average price per kilogram of seed cotton exceeded 10.5 yuan. He left cost, and he earned nearly 300,000 yuan, which was his home. This is the best year for growing cotton for more than 20 years. He originally planned to increase the planting area in 2011, but this year he still planted 200 mu of cotton because land contract fees rose too fast. Although the planting area has not increased, due to the high price of cotton last year, all agricultural materials related to cotton prices have risen and planting costs have gone up. Chai Zhigang, for example, said that fertilizer last year reached 67 yuan per bag and this year it rose to 80 yuan. Plastic film last year, 10.5 yuan 40 kg, this year rose to 12.8 yuan; seed last year 7 yuan per kilogram, this year is 12 yuan; especially the cost of labor, the most powerful rise. The daily labor cost for cotton seedlings in 2010 is 100 yuan, and this year it is at least 150 yuan, and sometimes 200 yuan. The price for picking flowers also rose sharply this year. In 2010, the price for picking and picking flowers was 1.6 yuan per kilogram. This year it was generally more than two yuan per kilogram, plus fare and return expenses, and the cost of picking flowers was 2.5 yuan per kilogram. More than a quarter of the cotton sales price. After half a year of hard work, there have been no more pickers.

According to a survey conducted by the Jinshi ** Cotton Survey Group, the planting cost per acre in northern Xinjiang in 2011 was 1,928.46 yuan, an increase of 22.71% over the previous year.

Chai Zhigang said that because the price of cotton was very high last year, everyone's expectations are high. He and many farmers have a psychological price of around 10 yuan. I did not expect the price to have been around 8.6 yuan since the beginning of this year's acquisition. Only when the level is high can I sell 9 yuan. For this reason, Chai Zhigang has been watching all the time in the half-a-half-month period of opening. He hoped that the price of cotton in the later period could be higher, and the cotton in the warehouse was not sold for more than a dozen tons of cotton.

Although the same as last year are reluctant to sell, but the mentality is not the same. Unstable cotton prices made him very embarrassed and feared that even the current price would not be sold for two days. The Chai Zhigang hired technicians also suggested that he sell it now. It is impossible to sell to last year's price. After all, it is a fact that the price of cotton is falling. The technician thinks that from the perspective of cotton farmers, of course, the higher the cotton price, the better, but from the market point of view, the cotton price was too high last year. At that time, the estimated price was 7 yuan per kilogram. Who would have thought that it would exceed 10 yuan? From the high price of 7.4 yuan per kilogram in 2003 to 8 yuan per kilogram to 4.8 yuan per kilogram of cotton sold in 2008, this ups and downs could not resist the market risk simply by relying on the cotton farmers' own strength.

According to the statistics of the Autonomous Region Cotton Association, the cotton sown area of ​​Xinjiang in 2010 was 21,909,000 mu, an increase of 3.64%; this year, the cotton planting area of ​​Xinjiang was 23.84 million mu, a year-on-year increase of 12.5%. Last year, the total cotton output of Xinjiang was 2.48 million tons, a reduction of 1.6%; and this year it is expected that the output will reach 3 million tons, increase production by 20%, and restore production levels in 2009. From the data, it can be seen that in 2010, production was reduced and prices increased. In 2011, the amount of production increased and the price fell. Between the “increase and decrease”, the change in the cotton market can be imagined.

Cotton is like a **

What are the attitudes of the cotton processing companies that are the first cotton-related cotton entering the market?

"In fact, we have no end in our hearts. We now receive cotton in our hands, just like holding a **, and we are all scared all day." On September 26, one of the new cotton industry in Manas County would not disclose it. The person in charge of the name indicated.

The person in charge told Xinjiang Metropolitan Daily that on the same day, the purchase price of the new cotton industry was between 8.8 yuan and 9 yuan. Less than two weeks after weighing, they have purchased more than 3,000 tons of seed cotton, which is almost one-third of last year. Many farmers have accepted the fact that the price of cotton has dropped, and they no longer suppress the goods and start selling them.

The person in charge said that under normal circumstances, cotton companies rely on ** to acquire cotton. However, there are also some companies that rely on hot money for acquisitions. Enterprises that depend on hot money are brave enough. There are also hot money in the cotton purchase companies of Manas. In 2010, many cotton companies rushed to buy cotton like crazy. The price was higher than one. If you get a hair up, you would dare to increase two hairs. Because of the lack of funds, coupled with the lack of market, they eventually received only 9,000 tons of cotton. Unexpectedly, after the acquisition, the price of cotton dropped sharply. After the recovered cotton was processed into lint, it could not be sold. In order to return, almost all cotton processing companies had to lose money to sell liquidity. They received less, but the pressure was much smaller. .

It is not only the cotton processing enterprises like the new cotton industry that are losing money. Many cotton spinning companies have their own ginning factories and spinning companies. The double pressure from cotton to cotton yarn has made it difficult for companies to breathe.

Since March of this year, cotton prices have fallen all the way, and the cotton spinning enterprises that purchase cotton at high prices have been dragged into a loss situation. At the beginning of the year, high-priced cotton purchased from more than 30,000 yuan was used to lose 3,000 to 5,000 yuan per ton of yarn. Cotton spinning companies agonize over the volatility of cotton prices. With the fall in cotton prices, yarn prices are also falling. The limited production, conversion, and production suspension of textile companies in the Mainland have resulted in small and small orders received by Xinjiang cotton spinning companies. A large number of cotton yarns have been used to secure the company's funds. The wages of workers must be sent, the production of enterprises must be maintained, and the capital chain has become the biggest problem that hampers cotton spinning companies.

Aksu West Cotton Company acquired 3,000 tons of lint at a high price of 32,000 yuan per ton, and it is still selling lint in June this year. Although the state gives a subsidy of 400 yuan per ton of cotton, if it is lower than 32,000 yuan per ton, it will be settled.

Lin Shujing, a cotton trader who has done cotton business for more than a decade in the Hami region, collected tens of thousands of tons of lint last year at a price of nearly 30,000 yuan per ton. At the beginning of this year, he still had a backlog of 20,000 tons. No way but to do it. Meat is sold at a price of 26,000 yuan per ton.

The heads of the new cotton industry said that this year they have again issued 1100 million yuan to the agricultural issuance and planned to acquire 13,000 tons of cotton. Although this year’s cotton is better than last year, but in the end it does not make money, they still have no end in their hearts. . However, this year's cotton purchasing and storage price is also a certainty, at least not lose money.

Ups and downs hurt the industry, "As early as this year's cotton is such a price, it would be better to plant melons! We have 30 acres of melons in the village, the income of more than 70,000 yuan, more than 2,000 yuan per mu output value, if this price, next year will certainly If you don't grow cotton, the cost of planting cotton will not be able to lower it again," said Cotton Farmer Chai Zhigang. Not only Chai Zhigang, many farmers have been planning to reduce the planting area next year.

“This year, the cotton planting cost in Xinjiang is between 1,800 and 2,100 yuan per mu, which is calculated based on an average cost of 1,900 yuan per mu and 300 kg per mu. The breakeven point is 6.33 yuan per kilogram. Calculated according to the reserve price, the seed cotton price is 8.5 per kg. From RMB 9 to RMB 9, the profit of cotton farmers is between RMB 2 and 2.5 per kilogram, and the return per hectare is over RMB 600. Compared with last year, the income will be less RMB 1200. If the price of seed cotton is lower than RMB 8.5 per kg, it will affect the cotton farmers next year. The enthusiasm for planting cotton has led cotton growers to replant trees and other crops. If cotton farmers insist on selling below 8.5 yuan, it will be detrimental to Xinjiang's cotton circulation enterprises." The 2011 Xinjiang Cotton Situation Analysis Conference and the negotiations for sales and purchases held on August 12 this year. At the meeting, Wei Gaocheng, chairman of the Party Committee of Xinjiang Cotton Industry Group Co., Ltd., said with concern.

According to the price of cotton after opening all over Xinjiang, Wei Gaocheng’s concerns may become a reality. If the planting area is greatly reduced, the output will fall, and the price will rise again, creating a vicious circle.

Someone has described that the game of cotton prices is like playing drums and flowers, and finally the florists are the ones who cry.

For the turbulent circle of cotton prices, Xinjiang textile industry experts said that this is not a good thing. Although the state-owned cotton enterprises play the role of “flooding and impounding” in the cotton business process, they have protected the interests of the cotton farmers to a certain extent, and have also made some textile companies reduce the risk of acquiring cotton. However, such large fluctuations will bring a blow to textile downstream enterprises and small and medium-sized enterprises, which will inevitably adversely affect the front-end industrial chain of cotton textiles. Industry veterans suggest that while protecting the interests of cotton farmers, the state should also formulate corresponding policies to support the development of medium and small-sized enterprises in the middle and lower reaches of cotton spinning. At the same time, Xinjiang should quickly change the way it relied mainly on exporting lint and cotton yarns, from the low end of the textile industry to the mid-end and high-end, and truly turn resource advantages into commodity advantages.