How will the decrease in cotton prices affect? Journalists conducting interviews in multiple places in Xinjiang

      Entering November, cotton futures prices continued to decline. The fluctuation of cotton prices affects the hearts of cotton farmers and cotton processing enterprises.

      Looking at Xinjiang for cotton production in China, Xinjiang's raw cotton production accounts for over 90% of the country. Recently, reporters conducted interviews in multiple regions of Xinjiang on the reasons for the decline in cotton prices, the impact on the industry, and the future development direction of the industry.

      Reduced production and shrinking demand

      According to a report from the China National Cotton Storage Information Center, the actual cotton planting area in 2023 was 41.402 million mu, a year-on-year decrease of 4.768 million mu, or 10.3%; The actual planting area of cotton in Xinjiang is 36.163 million mu, a year-on-year decrease of 3.155 million mu or 8.0%.

      Wang Li, Dean of the School of Economics and Management at Shihezi University, stated that supply and demand are the main factors affecting cotton price fluctuations. In terms of supply, due to the low temperature during the early spring cotton planting period and subsequent extreme weather conditions, grain demand, and the withdrawal of secondary cotton production areas, as well as multiple factors such as optimizing the cotton industry layout in Xinjiang, this year's cotton production reduction has become a foregone conclusion.

      In the past, a decrease in supply would inevitably lead to an increase in cotton prices, but recent frequent foreign wars and conflicts, as well as the Federal Reserve's interest rate hikes, have seriously affected the demand side, which is the main reason for this round of cotton price decline.

      However, some industry insiders believe that although cotton prices have fallen in the short term, global cotton production has overall decreased this year, which will provide some support for cotton prices in the future.

      Cotton is an agricultural product with a long industrial chain, involving multiple links from cotton planting, processing and circulation, spinning and weaving, to textile and clothing. The decline in cotton prices will have a significant impact on each link.

      Wang Li stated that we should attach importance to the construction of the resilience of the entire cotton industry chain, play a policy oriented role, and concentrate resources and policy advantages through agricultural subsidies, technical training, and market-oriented policies to ensure stable yield, high quality, and strong competitiveness of cotton in suitable cotton areas.

      Price fluctuations affecting acquisitions

      At present, the new cotton picking and sales work has entered the second half stage. As of November 9th, the national progress of new cotton picking is 87%, the sales rate is 75.4%, and the sales rate is 2.1%.

      As the cotton harvest season approaches, Yimin Abula, a villager from Ayikule Town in Aksu City, occasionally visits a nearby ginning factory to inquire about the purchase price. This year, he planted 510 acres of machine harvested cotton, with an estimated yield of over 400 kilograms per acre. The land transfer fee is 850 yuan per acre, and the cost of cotton cultivation per acre has reached over 2900 yuan. In recent years, measures such as high standard farmland construction have increased cotton production, with 300 kilograms of cotton per acre being a breakeven yield. There is no rush to sell cotton now, we still want to wait and see, "said Yimin Abula.

      There are 48 cotton acquisition companies in Aksu City, and currently there are 41 companies that have started to acquire cotton. The fluctuation of cotton prices is affecting the confidence of companies in acquiring cotton.

      Aksu Tianquan Cotton Industry Co., Ltd. is one of the earliest local enterprises to start purchasing cotton. Currently, it purchases handpicked cotton at a price of 9.1 yuan per kilogram. The price of handpicked cotton this year is more than 2 yuan higher than last year. The main reason for starting the acquisition of cotton so early is to complete the orders received by the company in the early stage