Registration : The annual banking festival “2017 China Banking Development Forum and the 5th Bank Comprehensive Selection Awards Ceremony†hosted by Sina Finance will be held on August 24th at the Westin Beijing Financial Street Hotel, so stay tuned . [registration entry]
After a long time, the cotton yarn futures are finally coming! Tomorrow (August 18th) cotton yarn futures will be officially listed in Zhengshang. According to the agenda of the Zhengshang Institute, the leaders from the China Securities Regulatory Commission, the Henan Provincial Government, the China National Textile and Apparel Council and Zhengshang Institute will deliver a speech and witness the meaningful moment of the cotton yarn futures market. The listing of cotton yarn futures will further enrich the cotton futures variety system and provide more risk management tools for cotton-related enterprises. It can help enterprises reduce risks, lock in profits, and enhance capital management capabilities to ensure continuity and stability of production.
1. After pricing cotton yarn futures, how to price?
1) The price structure of cotton yarn. Among the cotton yarn costs, cotton accounts for the largest proportion. Generally speaking, due to factors such as regional raw materials, labor, electricity, machine depreciation, and financial costs, the cost of spinning enterprises (pure cotton) is roughly composed of: raw materials account for 60-70%, and processing costs account for 28- 40%. According to the research, with the increase of yarn count, the cost of generating yarn per ton rises. The loss from cotton to cotton yarns also varies according to product specifications and processing plants. The loss of spun cotton yarn C32S is generally 8%-10%. Due to the large difference in processing costs and labor costs in various regions, the cost of processing pure cotton yarn C32S in the Mainland is generally between 5,500 and 6,500 yuan/ton, and the higher is also 7,000 yuan/ton, while Xinjiang enterprises have various The subsidy policy production cost is 2,000-3,000 yuan/ton cheaper than the mainland, but the depreciation expense of new equipment is relatively high. Even in the same region, different companies often have significant differences in cost due to differences in financing costs and management levels.
2) Look for the "price anchor" for cotton yarn futures. The price of cotton and cotton yarns is surprisingly synchronized. According to Zhengshang's data, the cotton and cotton yarn price correlation is 0.97, while the cotton and PTA correlation is 0.75. After the listing, cotton and cotton yarn futures are expected to become the most powerful futures varieties in the domestic futures market. So, is the price of cotton determining the price of cotton yarn, or is the price of cotton yarn leading the price of cotton? As a cotton-spun industry with complete market competition, the price of low-end and mid-range products represented by 32 cotton yarns is so high that it is difficult to change the price of cotton. Due to the difference in processing costs, we do not recommend the rationality of the price of cotton yarn futures from the perspective of cost, but should look for the reasonable difference between the price difference between cotton yarn and cotton (inner cotton, imported cotton and Zheng cotton). The position of the spread is used as the “price anchor†for cotton yarn futures.
After historical data analysis, we believe that the current external environment has created an ideal time for listing domestic cotton yarn futures. On the one hand, after nearly ten years of policy and market competition, the cotton-related industrial chain has gradually become relatively stable, especially the cotton yarn-cotton price difference (domestic cotton, imported cotton and Zheng cotton) has gradually stabilized at 7,000 yuan / ton level ( Imported cotton and Zheng cotton add 500-1000 yuan/ton to the average. The three tend to be unified, so that cotton and cotton yarn futures can fly together, providing favorable hedge opportunities for the industrial chain. It can not only smooth the fluctuation of upstream cotton futures prices, but also make the purchase of raw materials for downstream cotton mills have an authoritative and transparent cotton price reference, which is conducive to enterprises to implement sunshine procurement. On the other hand, the current imported cotton yarn and domestic cotton yarn have already formed a price upside down. The original market concerns about the low-cost imported yarn “replacement delivery†no longer exist, which has created sufficient transition time for the future import yarn to formally participate in the delivery. For the full price pricing of cotton yarn futures, considering the commodity attributes and financial attributes, we suggest that you can consider the basic considerations of cotton futures contract price +7500 yuan premium + correction factor for cotton yarn futures.
Second, after the cotton yarn futures market, how do companies participate?
Viewpoint 1: Locking cotton yarn production costs and profits through hedging, forming a basis pricing model (Yang Shanghai, senior analyst of Cotton Research, Changjiang Futures Research Department)
The first mode of participation is to avoid risks. Although there are many varieties of cotton yarns, the basic trend is relatively consistent. The futures market is used for trend hedging and risk avoidance. As long as you have a certain degree of certainty, you can hedge the different varieties. If the company has inventory and is worried about the price drop, it will establish an empty order in the futures market to preserve the existing stock; or when the price is falling, the average company will not buy the goods, the enterprise can also pass the futures hedging and then boldly acquire . Buying hedges means that the company accounts for production costs, locks production costs and profits in low-cost regions, and establishes multiple orders in the futures market to lock in raw material costs. Or when traders are very valuable in the futures market, they will build multiple orders through the futures market and establish virtual stocks. Industry chain hedging, upstream products to buy, downstream products to sell, lock production profits, that is, buy cotton, sell cotton yarn, lock profits.
Second, the trade pattern of enterprise participation is mainly based on the basis price. The advantage of the basis pricing model for the seller is that it can guarantee reasonable profits, quickly transfer risks, reduce the risk of holding positions and speed up sales. For the buyer, although it is possible to advance the procurement time by several months, it is conducive to rational arrangement of production, but it is necessary to judge the basis and have certain professional requirements.
The third is the investment strategy of the investment enterprise. The company negotiates with the factory warehouse to register the warehouse receipt and sell it; or when the price is right, the warehouse receipt is sold back to the factory warehouse; or the sales receipt of the warehouse receipt. When the current price difference is appropriate, the delivery arbitrage is also carried out. In addition, the correlation between cotton and cotton yarn is very high, reaching 0.945 in the long run, and the price fitting is also very good. You can do more short-spinning profit (mean regression) and arbitrage based on different fundamentals to expand and shrink profits (mean does not return). Finally, based on the basics of cotton yarn and cotton fundamentals, it is also possible to make a buy or sell transaction on one side. Or based on the different fundamentals of different periods, the cotton yarn inter-stage arbitrage.
Viewpoint 2: Suggested cotton yarn futures to be listed at the beginning of the short-selling strategy (Dong Wenke, Dadi R&D Department)
Due to the oversupply of cotton in addition to China in the new year, cotton yarn stocks are currently around 18 days, with a high level in the same period of three years. The inventory of industrial fabrics is close to one month, with historical highs and fundamentals being empty. Therefore, it is recommended that cotton yarn futures be listed as a short-selling strategy. The benchmark price of CY1801 is 23,000 yuan/ton, and the contract price of CF1801 is 15145 yuan/ton on August 16, the price difference is 7855 yuan/ton, and the spread is near the median. As the overall fundamentals are caused by poor downstream demand transmission, the profit is gradually squeezed upwards. Therefore, the strategy of choosing to buy 1 hand cotton and 1 cotton yarn strategy is adopted.
Risk point: cotton yarn delivery storage capacity limit, the position is too large and easy to squeeze.
Viewpoint 3: There are many cross-species and arbitrage opportunities in the initial stage of the listing (Ji Guangpo, chief expert and executive deputy general manager of Shanghai International Cotton Trading Center)
After the new varieties are put on the market, under normal circumstances, the price will occasionally have unexpected fluctuations within two years, and most participants are unfamiliar with the industry, and the spot market operation trajectory needs to be run-in. Investors can Risk appetite to determine participation. Judging from the influence of seasonal factors, the weak season of downstream demand has a greater impact on prices. Under normal circumstances, May to August and December to February of the following year is the off-season of cotton yarn demand, while the annual September to November is the peak season, and March to April is the small peak season.
According to the operating experience of cotton futures over the past 10 years and the comparison of cotton yarn cost price, it is expected that the cotton yarn futures will be operated in a more rational situation at the initial stage of listing, and any over-selling and oversold from the spot price appearing in the market is an opportunity to enter. At the same time, according to the past listing of new varieties, cotton yarns may have greater participation opportunities in the two years before the market, such as cotton, cotton yarn arbitrage and spot arbitrage opportunities. The market expects that due to the constant processing cost between cotton and cotton yarn, once the price of the two deviates, the market will immediately have arbitrage opportunities. Since the cotton yarn is delivered continuously every month, the cost of holding the contract is basically constant. Once there is a deviation, the market will also have arbitrage opportunities. In addition, the spot market will appear in the form of trading the cotton yarn spot price against cotton yarn futures. There will be a trading form of cotton spot price against cotton yarn futures. There may also be a combination of four varieties of cotton spot and cotton yarn. Point price transaction form.
3. After the cotton yarn futures are listed, can we provide pricing benchmarks for global cotton yarns?
China is currently the country with the largest production and consumption of cotton yarn. The spinning capacity has reached 120 million spindles, which is also the world's number one, accounting for about 40% of the world's production capacity. In addition, China's cotton, cotton yarn and clothing and other imports and exports are large, and occupy an important position in the global market. The listing of cotton yarn futures will have an important impact on the global cotton, cotton yarn and alternative market.
Opinion 1: Zhengzhou cotton yarn is expected to become the benchmark for global cotton yarn trade in the future (Wu Faxin, Chief Strategy Officer, Shanghai Yarn Technology Co., Ltd.)
At present, there is no cotton futures market listed in the global futures market. From the current development status of the spot market in the main producing countries and the consumer countries, the cotton yarn sales prices are disorderly and opaque, lacking the necessary contract factors, and the market volatility is very low, the performance rate is very low, the industrial enterprises The production plan is very unstable. In addition, some areas of the cotton yarn market sales invoice management is not standardized, lack of after-sales service, quality disputes. After the cotton yarn futures are listed on the Zhengshang Institute, the domestic cotton yarn market will soon form a unified and transparent price. Due to the uniform quality standards of cotton yarn futures, industrial enterprises in the spot market will standardize the spot trade according to the delivery standards of cotton yarn futures, which will increase the market compliance rate and help industrial enterprises to arrange production and business plans. At present, China's cotton and cotton yarn industry is undergoing a structural and strategic shift. For example, the upgrading of products and the transfer of industries are having a major impact on the world's major cotton and cotton yarn producing countries - India, Pakistan and Vietnam. It is understood that in order to avoid the price shock of imported cotton yarn, and in order to ensure the steady start of cotton yarn futures, cotton yarn futures are not allowed to be imported at the beginning of the market. After the smooth operation in the later stage, the imported cotton yarn is gradually released. The future price of Zhengzhou cotton yarn will become the benchmark for cotton yarn trade in the world (including ring spinning, air spinning), and the price reference standard (blended yarn) of non-standard products is very high.
Author: XXX; Source: SICE edited According to information; agricultural futures to reproduce this network to disseminate more information purposes only, does not mean Ben Wang approved the text of the opinion. If the author of the reprinted article believes that there is something wrong with this website, please contact us at 010-51289506. This website will immediately negotiate with you and resolve related matters. We invite you to join the elite group of cotton and cotton yarn industry, QQ group number 386426398.
Enter [Sina Finance and Economics Unit] Discussion
Article Keywords: Agricultural Products Futures Cotton
I want to feedback the save page
- DIMENSIONS : Twin, Full,Queen,King.Fully elasticized fitted sheet is designed to hug your mattress up to 15 inches deep.
- SLEEP IN LUXURY: At the end of the day, you deserve a little luxury. So, go ahead, lie down on Bare Home's twin xl fitted sheets. Warm in winter, cool in summer, it`s the sleeping companion you`ve been searching for.
- EASY CARE: Bedtime is supposed to be relaxing. That`s why Bare Home's twin xl size fitted sheets are machine washable and designed to perform flawlessly every day, night, or nap time.
cotton fitted sheet, poyester fitted sheet,bamboo fitted sheet
Nantong Otter Textile , https://www.ottertextile.com