Weekly Report: Large Contract Launched for Reserve Purchase

Last week (21st/25th October), weather in major cotton regions nationwide was positive for cotton picking. By the end of the month, seed cotton price increased slightly for the better quality cotton before the coming frost. According to CCA cotton processing industry, Xinjiang weekly average price for seed cotton equivalent of 3128 was 9.30 Yuan per kilo, 0.04 Yuan up over the week; similar quality in inland was 8.64 Yuan per kilo, 0.02 Yuan up over the week.
Seed cotton buying was more active in Xinjiang, Hebei and Shandong than that in Yangtze regions of Hunan, Hubei Provinces, where the low quality impeded cotton from reserve. In Xinjiang, cotton picking was 15 days later than normal years, the harvest was pressing before frost; therefore, more labor demand leveled up the cost to 2.30-2.40 Yuan per kilo for seed cotton hand picking.
According to Regulations on Large Contract Reserve Transaction for Cotton Company, China Cotton Association examined and verified the qualification of cotton companies applying for large contract transaction and finalized 17 cotton companies and 3 cotton cooperatives, and published the list on 21st October. On 25th, October, the first large contract offer of 100,000 ton was sold out quickly. By 25th October, reserve purchase of 2013/14 season totaled 731,050 ton, comprising of 538,720 ton from Xinjiang, 192,330 ton from inland.
On 25th, October, CC Index 3128B settled at 19,659 Yuan per ton, 67 Yuan up over the week, ZCE futures nearby contract settled at 20,295 Yuan per ton, 145 Yuan up over the week.
As for import cotton price, FC Index settled at 90.84 cent/lb., 3.22 cent down over the week.