1. Traders’ reflection
Around 62% of traders under survey reflected that arrivals of imported cotton yarn in Dec were higher than Nov, around 9% of traders expected Dec arrivals to be flat with Nov, and around 29% of traders expressed that Dec arrivals were smaller than Nov. Arrivals of imported cotton yarn in Dec are expected to inch up compared with Nov.
2. Estimate of arrivals
After surveying some sampling companies by telephone, Dec arrivals of imported cotton yarn are assessed to increase by 11.48% on the month to 199.3kt, up by 6.52% compared with the same period of last year. Imports of cotton yarn kept falling since July 2016 but increased from Nov, which may keep edging up slightly on the year in the next months.
3. Regional estimate
Arrivals in Guangdong in Dec is expected to rise by around 8.96% compared with Nov. Spot supply of imported cotton yarn was ample in Dec and downstream demand remained poor. Price of imported siro-spun low-count cotton yarn was stable to weak, with Pakistani grade-A siro-spun 10S staying at 19,000-19,200yuan/mt. Inventory of spot imported cotton yarn is expected to be high in Jan, and price is likely to be weak to stable with cost support.
Arrivals of imported cotton yarn are anticipated to increase by 3.10% on the month in Fujian. Stocks of imported cotton yarn were not ample in Dec in Fujian with dull demand, and price was flat. Price of spot imported cotton yarn is supposed to be weak to stable in Jan in Fujian and transactions may be sluggish.
Arrivals in Zhejiang and Jiangsu in Dec are supposed to accumulate by 4.75% m-o-m. Inventory of spot imported cotton yarn was divided in Dec in Zhejiang and Jiangsu. Supply of imported carded 32S for weaving was scarce, that of carded 21S for weaving was ample and that of combed cotton yarn for knitting and low-count open-end cotton yarn was scant. Price of spot imported cotton yarn is expected to be stable in Jan and inventory may rise stably.
Arrivals of imported cotton yarn in North China in Dec may increase by 27.41% on the month. Stocks of imported cotton yarn piled up in Dec in North China, and price was weaker than that in Zhejiang and Jiangsu. Imported carded 21S for weaving was lower pegged at around 20,800yuan/mt. Stocks of imported cotton yarn may inch up in Jan in North China, and price is expected to be weak.
4. Inventory assessment
Arrivals of imported cotton yarn may climb up on the month in Dec, and inventory rose to around 96kt at major China ports with slack demand. Arrivals of imported cotton yarn in Jan are supposed to be not small; price of imported cotton yarn may be hard to increase or decrease, more likely to be divided in various regions.
5. Market outlook
According to arrivals assessment for cotton yarn, spot inventory of traders and downstream demand, inventory of imported cotton yarn may inch up in Jan, operating rate of downstream weavers is likely to drop, supply is expected to be ample, and price is likely to be hard to rise or decrease, slanting divided in different regions.
Note: The telephone survey made by CCFGroup involves around 40 companies, containing around 55% of total cotton yarn imports. The sampling survey is incomplete and the result is only for reference.