In addition to the 1% tariff quota of 894000 tons stipulated by WTO, our government issued an additional quota of 800000 tons to textile enterprises above the scale in October this year. The deadline is February 2019. At present, there is no extension notice. In view of the gap after the stock of reserve cotton is reduced, most of the market expects that our cotton import market will be liberalized step by step. The quota applied by enterprises with a capacity of more than 50,000 gauze ingots in the near future, whether to consider the import quota of enterprises under 50,000 gauze ingots at a later stage. If liberalize gradually goes step by step, our cotton market imports will appear marketization.
However, at present, the 800000 ton quota enterprises have only been in use for more than two months. In the context of the current Sino-US trade war, American cotton has been imposed a tariff of 25 percent, and now it has eliminated American cotton. The other options available are Indian cotton and Brazilian cotton. Judging from the current price situation, because of the weak purchase price of new cotton in the domestic market, the cost of cotton in Xinjiang, especially in northern Xinjiang, is generally lower than that of imported cotton from any country. The Indian cotton quotation is directly converted into a quasi-clearance cost of 15500-16,000 yuan per ton. Brazilian cotton is more than 16000 yuan / ton, but India cotton import price ratio is on the low side, in the short term, the whole import is moving. Lack of power, such as the release of partial quotas, can lead to import volume is also relatively limited.
According to the global cotton supply and demand balance, the overall cotton production is in a destocking cycle. The drought in India and Texas, the main U.S. region, and two major hurricanes have affected the southeast cotton region this year, resulting in a decline in overall production this year. The most likely future increase in global production is India, where yields are relatively low, such as a relatively large increase after improved planting technology. As for the 2019 operation, the impact of the current Sino-US trade war has led to a global economic downturn. Recently, India, Vietnam, and other places have strong cotton prices upstream, and the downstream cotton yarn is facing losses. According to the more difficult sales, cotton textile enterprises are faced with problems, and the latter will be faced with a revised market.
For this year, in order to improve the enthusiasm of cotton farmers, the Indian government has greatly increased the price of MSP, which is similar to China's unlimited reserve of 20400 yuan / ton in 2012-2013 when the global cotton market fell. The price of Indian cotton in the international market is at a high level.
India, the world's first-largest cotton-producing country and the second-largest cotton-exporting country, has an important impact on the world's cotton prices.
In the last two years, the Indian cotton bollworm has been hit by the red cotton bollworm, which has led to the production of cotton in the Indian cotton.
In 2018, the Indian government raised the minimum support price of cotton MSP by about 26-28%, with the minimum support price of long-staple cotton increasing by 26.16% to 5450 rupees per litre. Medium wool rose by 28% to 5150 rupees per cum. Greatly stabilized the Mahalat, Gujarat and Madhya Pradesh cotton conversion rate of relatively high rates of cotton planting sentiment. And India raised MSP prices also supported the overall cotton market prices. High cotton prices have also led to losses for the downstream spinning industry in India State, at present, India's yarn profits are at the lower level of the calendar year.
