Home / Knowledge / News / Textiles / New York cotton market experiences dull trading
New York cotton market experiences dull trading
13
Dec '11
Plexus Cotton Limited reports that New York futures moved sideways in very dull trading this week, as March added 75 points to close at 92.05 cents.

It was more of the same this week, as general price weakness emanating from plentiful international offers continued to be offset by aggressive Chinese Reserve buying. Through its domestic auction program the Reserve has added another 1.1 million statistical bales to its stockpile this week, which means that it has already accumulated around 6.1 million bales since the middle of October, which equates to roughly 18 percent of China's crop this season.

The maximum daily auction target is currently at 577'000 statistical bales and the fact that less cotton was taken up this week, combined with an ever so slight rise in domestic prices, seems to indicate that the support mechanism is working.

Against this backdrop of Chinese support, which has kept the CC-index at a relatively elevated level of around 136 cents when compared to the current A-index of 98.70 cents, mills around the globe have been getting some breathing room lately and are now in many cases able to turn a profit against current replacement cost.

However, a lot of mills are still struggling to digest the many high price contracts they have engaged in earlier this year and it is going to take a while until this overhang of expensive cotton has finally been worked through the system.

Recent US export sales reports have been reflecting this tug-of-war in the market between Chinese support and struggling markets elsewhere. The latest report, which was released this morning, showed once again a net gain for China in the amount of 35'400 running bales, while the rest of the world went the other way and cancelled a combined 58'400 running bales, resulting in a net reduction of 23'000 running bales of Upland and Pima cotton.

The only positive in the report was the increased pace of shipments, which amounted to 244'800 running bales. Nevertheless, total exports to date still amount ot only 2.1 million statistical bales, leaving a large unshipped balance of around 8.4 million bales, not counting 1.3 million bales in optional sales.

This large amount of outstanding commitments seems to worry the market, because of potential cancellations. However, when we look at who has booked these 8.4 million in outstanding sales, the majority belongs to China (4.8 million bales), followed by Turkey (0.7 million bales) and Mexico (0.4 million bales).

These three markets account for about 70 percent of all unshipped sales and they pose a relatively limited default risk in our opinion. Beyond that we have 9 markets that are owed between 0.1 and 0.35 million bales each, which is not a large amount in terms or their respective annual mill use and a lot less than what they had on their books a year ago.

In other words, while there probably will be some additional cancellations in the weeksahead, we don't think that they are going to add up to a significant amount and that net sales will continue to grow overall.


Must ReadView All

Textiles | On 25th Jul 2017

Global growth to pick up in 2017 and 2018: IMF

The pickup in global growth anticipated in the April World Economic...

Textiles | On 25th Jul 2017

Egypt signs agreement with UNIDO for cotton production

Egypt has signed a €1.5 million ($1.74 million) cooperation agreement ...

Textiles | On 25th Jul 2017

Pakistan’s textile exports stay stable in FY17

The value of textile and garment exports made by Pakistan increased...

Interviews View All

Sunil Kumar Sharma
Loknayak JPNSSSG Ltd

'The blend of cotton–linen yarn has high demand in the domestic and...

Abhishek Ganguly
Puma India

‘As a brand, Puma is always looking for new and innovative ways to inspire ...

Stefan Warnaar
Peak to Plateau

People are willing to pay for quality and performance

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Sonam & Paras Modi
SVA

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

July 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Thanks for your valuable feedback. Claim your free latest sustainability e-book.


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search



X