Weekly Report: Mills Buying Increased Reserve Transaction and Cotton Import

As this turn of reserve release will come to an end, textile mills are more active at reserve cotton buying in worry of the likelihood of insufficient cotton supply in September and the rush in transaction during the last few release days. By last week (11th-15th August), the reserve cotton was sold by 75,500 tons, 23.3% up over last week. By 15th August, the total reserve release had been 2,472,600 tons; the transaction rate is 21.46%, including 2,320,300 tons of domestic cotton and 152,300 tons of import cotton. The Xinjiang Production and Construction Corps (PCC) auction sold cotton of 1,411 tons, 5.1% of the transaction rate against the offer.
Import cotton volume increased over the month. According to Customs, in July China imported cotton of 280,300 tons, 28.4% up over the month. The first eleven months import during 2013/14 season totaled 2,799,000 tons, 32.1% less than the corresponding time last season. The first seven months’ import in 2014 calendar year is 1,675,000 tons, 39.1% down over the corresponding time last year.
Last week, cotton plant came to flowering period nationwide, and that in Xinjiang and Huabei region entered boll opening stage. Weather in the North is conducive for cotton growth; while the lasting rain and low temperature in the South slowed down the growing process.
Domestic lint sales witnessed a second time price increase since the fall from March. On 15th August, CC Index3128B settled at 17,121 Yuan per ton, 6 Yuan up over the week.
As for the import cotton price, FC Index settled at 78.19 cent/lb., 0.85 cent up over the week.