Cotton distribution has reached 50% of the total procurement. Physical price continued weak while CNCE and ZCE prices consolidated. Cotton yarn price remained steady. No changed has been made to the softening polyester staple price.
As of March 8, cotton ginning finished 85.98%, up 0.26% from previous week but down 9.13% from year ago level. Sales have accomplished 50.66% of the total procurement, up 2.47% from last week and 3.41% higher year on year.
Assuming a production of 5.7 mil tons and a 99.05% harvested crop, cumulative lint cotton procurement is estimated at 5.43 mil tons, basically unchanged from previous week. Cotton ginning gained 10,000 to 4.76 mil tons and selling was up 130,000 to 2.75 mil tons.
CNCotton-S averaged 13836 yuan per ton for the week ending March 17, down 11 yuan or 0.08% from last week.
Physical trade remained light amid a declining cash price. Lack of fresh offtake has allowed the wait-and-see emotion at ZCE and CNCE market to intensify and prices went into cosolidation.
On March 16, T328 for delivery at mill averaged 14304 yuan per ton, down 52 or 0.36% from previous week. May futures at ZCE futures lost 120 yuan or 0.81% to 14665 yuan per ton. MA0605 averaged 14605, up 22 or 0.15% from a week earlier.
Yarn prices remained flat and polyester staple price registered more loss. 32s carded yarn was quoted at 19780 yuan per ton, unchanged from previous week. Polyester staple dropped 200 or 1.94% to 10100 yuan per ton.
2006 import quota totals 2.4 mil tons, of which only one third has been used. This means that the remaining 1.6 mil are a substantial amount. Provided an accelerated RMB appreciation within this year, it is expected that the imported lots will become increasingly competitive. Amid such a circumstances, domestic cash prices are under tremendous pressure and it may take a longer time for the domestic price to get stabilized.
