Cotton storage policy adjustment is imminent

On the 18th, Sun Ruizhe, vice president of the China National Textile and Apparel Federation, revealed that the policy of cotton collection and storage is expected to be adjusted this year, which means direct subsidies for cotton farmers. The Xinjiang Cotton Conference to be held in the near future will discuss the policy further. The Xinjiang region is expected to be the first pilot region.

Analysts pointed out that the adjustment of the storage and storage policy means that China Cotton Storage will gradually fade out of the cotton trading market, and the circulation of cotton trade will depend more on the market supply and demand. The above policies will ensure the interests of cotton farmers while not harming the textile and garment industry. In the future, the textile and garment industry is expected to obtain cheaper raw materials.

Direct subsidy policy or this year introduced "direct subsidy cotton farmers are expected to pilot in Xinjiang, the main cotton producing area, and gradually spread throughout the country." Sun Ruizhe told the China Securities Journal reporter.

Liu Xiaonan, deputy director of the Development and Reform Commission’s economic and trade department, recently stated at the China International Cotton Conference that the National Development and Reform Commission and related departments are studying how to further improve the cotton market's regulatory mechanism and explore the establishment of a long-term mechanism to promote the long-term stable and healthy development of the cotton industry. He also revealed that the country is studying relevant measures to ease the distortions in the cotton market caused by the purchase and storage policies. Industry insiders expect that the adjustment of the cotton purchasing and storage policy next year will be a high-probability event, and 2013 will become the year of “succession” of cotton collection and storage.

Authoritative sources revealed that in order to establish a long-term regulatory mechanism, relevant state departments have begun to study related measures to make storage and storage a market aid, and direct subsidies for cotton farmers are expected to be introduced.

Sun Liwu, an analyst at Zhuo Chuang, believes that from a nationwide perspective, due to the decentralized planting area and the unknown area, it is difficult to implement the direct subsidies policy. In view of the development of the domestic cotton market, the purchase and storage policies will come to an end and the adjustment of policies in 2014 will be inevitable.

According to the 2012 cotton purchasing and storage situation, the actual actual storage volume was 6.62 million tons, including 4.21 million tons in Xinjiang and 2.41 million tons in the Mainland. Cotton accounts for 89% of the total cotton production in the current year, and there are very few cottons listed and circulated.

With the rapid increase in the total amount of cotton storage and storage, inventory risks are increasing. According to industry insiders, the current State Reserve Inventory cotton is equivalent to one year's use of China's textile industry. If you add in 2013, the total amount will exceed 13 million tons.

Sun Liwu told the China Securities Journal that the simple policy of purchasing and depositing has played an important role in protecting cotton farmers and stabilizing domestic cotton prices. However, it has also led to an uneven supply and demand of market resources. The domestic and foreign cotton price gap has widened, which has led to the profit of domestic textile companies. Decline.