The Sino-U.S. Trade war has continued from April to the present. Although there has been a reversal during this period, the results have been unsatisfactory, and the current Sino-U.S. Trade situation has become more severe. It can be said that China has made great efforts in Sino-US trade relations, among which the sad people can feel for themselves. In the growing bilateral relations, cotton has inevitably become the weight of the trade war. Since June 5, the US cotton has dropped from the high of 93 cents / lb to the 82 cents / lb line, and Zheng Mian has also been from 18,300 yuan / The ton position has been down to 16,500 yuan / ton. On July 6, China and the United States will make a final decision on whether to impose tariffs on each other. How much impact the trade war will have on China's cotton textile industry, and how much will affect the price trend of cotton in the later period. And analyze the development status of China's cotton textile industry.
China-US cotton textile trade situation
As we all know, the cotton textile industry is a labor-intensive industry. From 2003 to 2012, China achieved a golden decade of rapid development of the cotton textile industry with cheap labor costs and loose investment policies. Since then, as China ’s labor costs increased, cotton The textile market has gradually shifted to Southeast Asia, and China's cotton textile export situation has begun to shrink.
Undoubtedly, China is still the largest textile and apparel export country, but since the financial crisis in 2008, China has paid more attention to the role of domestic demand. It is understood that China's domestic clothing sales accounted for 76% in 2008, and China's textile and apparel exports in 2017 were 24640 RMB 100 billion, domestic retail apparel, shoes, hats, textiles, knitting, etc. are 1.5655 trillion yuan, with exports accounting for about 63.5%. In recent years, the U.S. market ’s share of China ’s cotton and textile export trade has stabilized at around 16%, and as the U.S. economic recovery has gradually increased, the total value of China ’s textile and apparel exports was US $ 268.583 billion in 2017, of which US $ 110.491 billion in textiles. US $ 158.092 billion, the main exporting countries are the United States, Japan, Vietnam, Hong Kong, China, exports to the US 45.393 billion US dollars, the United States in China's cotton textile apparel trade accounted for 16.9%. The recovery trend of US apparel consumption is obvious this year. From January to May 2018, the cumulative sales of US apparel and accessories stores increased by 10.66% year-on-year. It is expected that this proportion will continue to increase, and Japanese demand will be sluggish. The accumulative sales of accessories increased by 0.79% year-on-year, and the demand for Japanese apparel grew at a low rate.
Therefore, it is foreseeable that the Sino-U.S. Trade war will never come to an end. Both China and the United States are making adequate preparations for this. If the Sino-U.S. Trade situation deteriorates further, the U.S. side will most likely restrict China ’s cotton textile exports.
China's textile and apparel industry
In recent years, China ’s labor costs have increased and it has squeezed the profits of China ’s cotton textile industry. Many companies have chosen to set up factories in Southeast Asian countries. The industry prosperity index has declined. Especially for the production of grey cloths, the industry prosperity index has declined significantly in the past four years. Seek development in the direction of innovation.
How does the cotton price change after the tariffs are imposed?
First, China ’s additional tariffs on US cotton will increase the cost of cotton imports. Although the amount of imported cotton in China is not large, this year's situation is special. The cotton stocks in China's national reserve have declined. Whether the country increases imports by liberalizing the quasi-tax, or the national reserve directly increases imports, China's cotton demand will be more A larger level of improvement. In recent years, China ’s imports of U.S. cotton have continued to increase, mainly due to the high cost performance of U.S. cotton. If U.S. cotton ’s import advantages are no longer available, China is likely to import Australian cotton. Australian cotton is listed later, generally 4-9 In the month, there is a mismatch in the supply and demand time of the market, which will increase the tension of China's demand for high-quality cotton in the second half of the year. Therefore, domestic cotton prices in the second half of the year are likely to rise in conjunction with global cotton prices.
Second, the US has imposed tariffs on Chinese textiles and clothing. Judging from the recent Sino-US relations, the probability of Sino-US trade friendly consultations is not high. China and the United States each seek new trade channels to stabilize their economies. For the United States, after tariffs are imposed on China, imports can be transferred to Southeast Asia Regions, but for the Chinese cotton textile industry, the loss of 300 billion yuan in trade volume or even a larger trade market in the future will worsen the domestic textile industry, which will force domestic textile companies to accelerate their overseas investment and reduce cotton demand.
Finally, the transmission process of cotton prices. From a fundamental point of view, even if China and the United States impose tariffs on each other, since the cotton acreage between China and the United States is a foregone conclusion, the current fundamentals of the cotton market will not be affected much. In the second half of the year, the global cotton market is still tight in supply and demand. In some cases, prices will tend to rise. With the increase in cotton prices, China ’s demand for cotton has weakened, and cotton demand has turned into import demand for cotton yarn. Yarn imports will increase. If the foreign investment in the cotton textile industry accelerates, the demand for cotton will be further squeezed. Tend to fall.
Therefore, the author believes that Sino-US trade tensions have just begun, and it is likely to become the norm in the future, but the short-term impact on the cotton supply and demand situation is not significant. The market will return to the fundamentals and will usher in an upward cycle, but it will affect the next year ’s cotton supply and demand Larger, the cost of the cotton textile industry may rise further in the future, the supply and demand structure will be rearranged and combined in the global market, and China's cotton textile industry will accelerate its growth in this crisis.