Market still hold expectation despite of the risk of plunging cotton prices

The growth of new orders after Spring Festival failed to reach expectation but market remained positive since there’s still some time before the traditional peak season in Mar and Apr. According to our research, many viewed recent fall of 13,600-14,000yuan/mt in cotton as a short-term relatively low level. Unless market expectation changed, cotton yarn prices are unlikely to fall sharply.

Whether the prices would rebound depends on the growth of orders. After Spring Festival, domestic apparel market in Lanxi and Guangdong performed well while the exporter in Shaoxing and Ningbo, textile market in Nantong showed ordinary sales. The outlook of domestic apparel market is positive but for textile market it may not be easy to seek growth of export orders, though there might be some new orders from hotels. Market is now waiting for cotton price to stabilize and the demand may recover in Mar and Apr. But without the support of export orders, a booming demand is less expected.