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Insight | Time: Dec 9 2019 2:52PM
Nov cotton yarn imports may rise 26.84% m-o-m to 175kt
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1. Imported cotton yarn arrivals to China assessment

Cotton yarn imports to China in Nov are estimated at 175kt, up 13.23% y-o-y and 26.84% m-o-m. As demand for imported cotton yarn was tolerable in Sep-Oct and the price of USD and exchange rate provided some operating room for traders, so the surge of cotton yarn imports in Nov met the expectation. Considering that some Pakistani cotton yarn is not calculated into the customs’ data, the cotton yarn imports shown by the customs may be 25kt less than actual imports, and the cotton yarn imports of China customs is predicted at about 15kt.

According to the shipments in overseas market in Oct, the imports from Vietnam is estimated at 81kt, from India about 20.3kt mainly benefitting from the smooth exports of open-end cotton yarn to China, from Pakistan about 24.8kt (the customs statistics may show at 2-4kt), from Uzbekistan 18kt, from Indonesia 9kt, from Taiwan 8.5kt and from other regions and countries 13.4kt.

2. Traders' reflection

Note: Over 30 enterprises are surveyed, covering over 50% of cotton yarn imports.

Major traders and L/C issuing companies reported much more arrivals of imported cotton yarn in Nov.

3. Imported yarn stocks and supply and demand outlook in Dec
In Nov, arrivals of imported cotton yarn reached about 175kt. Due to the large amount of arrivals, the inventory moved up somewhat. In early Nov, the market participants held poor expectation to the market, but the sales of traders performed well and the overall market demand seemed better than expected. Although prices of open-end cotton yarn and siro-spun cotton yarn declined much, sales can move smoothly, and some traders were even reluctant to discount. As for profit, most varieties can gain over 500yuan/mt profit as the Sept-Nov sources were low-priced and RMB appreciated somewhat. With price of spot imported cotton yarn decreasing and that of forward imported cotton yarn increasing, the profits of traders reduced. Amid weakening profit, forward imported cotton yarn lent more support to spot one. However, with the new year and Spring Festival coming, traders were heavily burdened by settlement. Underselling increased in recent market. In short run, price of imported cotton yarn will keep weak.

[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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