The price of cotton sits on a roller coaster

One of the direct reasons for the sharp drop in cotton prices, the injury of cotton farmers and the despondency of the cotton market is the soaring cotton price last year. According to experts, the key to coping with the sharp rise and fall in agricultural product prices is to establish a coordination mechanism.

“To sell cotton is not to make money, it is better to pick up the grain as soon as possible.” A cotton farmer in Chengji Village, Zouping County, Binzhou City, Shandong Province, reluctantly said while picking cotton bolls at his door. In the first half of November, China Securities Journal reporters found that in many places in Shandong, the price drop of cotton caused many farmers to pull out cotton and grow grain in advance. The trading in the cotton market was deserted.

Almost every family planted cotton in Xiajin County, Dezhou City, Shandong Province, which is known as the "cotton capital." October and November should have been the peak season for cotton farmers to sell cotton and cotton for cotton, but this year not only did not appear last year's cotton-sweeping scene, and the cotton trade also fell into a stalemate.

"Now the seed cotton picking is basically over, but the progress of the sale is less than 10%." Ma Junkai, chairman of the Cotton Industry Association of Dezhou City, Shandong Province, explained that "This year, the purchase price of seed cotton is too low and it is currently at 3.9 yuan/kg, which is lower than the same period of last year. The 3.20 yuan / kg. Now sold, cotton farmers and even the cost will not come back, so do not sell. Compared with last year's cotton prices continue to rise, cotton farmers hope that the rise in cotton prices is very strong."

Zhang Minghao, a villager from Xiajin County, Xiajin County, confirmed Ma Junkai’s explanation. “Last year, seed cotton was sold at the highest price of 7.3 yuan/kg. Now everyone is waiting for the cotton price to rise, at least to 5 yuan/kg, we are willing to sell, so that it will not be innocuous for one year.” Zhang Minghao A cotton cost account. "This year's labor costs have risen so badly that the cost of picking the bolls rose from 0.5 yuan per catty last year to 0.75 yuan this year. The cost of stripping bolls also rose from 30 yuan per person per day last year to 40 yuan. 8000 pounds of cotton requires 20,000 yuan for labor costs, plus 1,000 yuan for seeds, 4,000 yuan for chemical fertilizers, and pesticides, hydropower, etc. The input cost for 20 acres of cotton land is nearly 30,000 yuan, which is not a year-round work in the cotton fields. The cost of going out to work is being delayed.” For example, at the current price of 3.9 yuan/kg, 8,000 kg of seed cotton can be sold for 31,200 yuan. This means that the family has been busy for a year in the cotton fields and has hardly made any money.

Farmers don’t make money, and cotton traders are “terrible”. Xiajin County seed cotton trading market is regarded as the largest seed cotton trading market in Shandong, but in this acquisition season, cotton merchants rarely appear. The vast trading market was deserted and only a few motorized tricycles were waiting to be pulled. At the peak of previous years, the traffickers outside the market were blocked several kilometers away.

A cotton trader in Zouping County, Binzhou, reluctantly said: “This year is the worst year I have received cotton for six years. It’s worse than the financial crisis. It’s been a busy day before I collected forty or fifty pounds. Compared with the collection of six or seven hundred pounds a day last year, the difference is far too far. Moreover, the quality of the cotton collected this year is not very good, and it is sold to processing companies, making less than two cents a pound."

The direct cause of the plunge in cotton prices, injury to cotton farmers, and deserted cotton markets was the soaring cotton price last year. Ma Junkai said: "After last year's soaring cotton prices, many farmers increased the area of ​​planted cotton. From the point of view of Dezhou City, the area of ​​planted cotton increased from 1.55 million mu last year to 1.6 million mu this year. In addition, this year's rainy weather caused continuous rain. The decline in the quality of cotton is also a reason for the lower cotton prices. Farmers and cotton traders have to save cotton first, but this is also a great risk. It is necessary to prevent fire, but also to prevent cotton from discoloration and quality degradation for a long time.”

The sudden rise and fall in prices has become a common phenomenon in the agricultural product market, especially in recent years. Last year, garlic, ginger, and cotton were jokingly called “garlic oysters,” “your ginger,” and “cotton palms” due to price spikes. In just one year, the prices of these agricultural products plunged. Many experts believe that large price fluctuations have both the objective factors of supply and demand due to the impact of disaster climate, but also the factors of high farmer prices, the expansion of planting area, the reduction of planting area and the declining price of planting area, and the factors of capital speculation. They suggested that on the one hand, we must establish a monitoring mechanism for price changes in agricultural products, strengthen the initiative and effectiveness of state regulation, improve the linkage mechanism between price fluctuations and subsidies for low-income people, and on the other hand, establish a planting plan for large agricultural products to increase the basic balance between supply and demand. possibility. The national regulation must be more market-based and prevent excessive damage to the economic fundamentals.

Li Jian, director of the Ministry of Commerce’s Research Institute for Foreign Economic Relations, believes that the key to responding to the sharp rise and fall in agricultural product prices is to establish a coordination mechanism. The production of agricultural products in China is still in the household-based household decentralized production operation, which has not formed a scale and is vulnerable to the control of large-scale funds. The production of agricultural products in Western countries has the characteristics of intensive and large-scale production. Farmers establish their own agricultural associations and other coordinating agencies to coordinate agricultural planting areas in different regions according to the annual market situation. This is similar to the effect of quota production, so that the annual output and price of agricultural products are basically the same. keep it steady. China should also have such a mechanism, but it will take a long time to establish it.

A person in charge of a large-scale textile company suggested that Xinjiang, as an area with few suitable high-quality cotton plants in the world, should produce low-cost and good-quality cotton. The state should adopt policy support to guide Xinjiang to develop this advantageous industry and strengthen Xinjiang’s The strategic position of the cotton supply area guarantees cotton planting area and supply in Xinjiang.

Wang Qiang, chief editor of the First Textile Network, believes that the sudden rise and fall in cotton prices is a special case in the past decade. The key to solving such problems lies in state regulation. This year, the country's first set of open storage price of 19,800 yuan/ton is the embodiment of regulation, which has played a certain role in stabilizing cotton prices and preventing the price of cotton from continuing to fall. The difference between this regulation and the past is that the previous price was the state's pricing for the market, which was an unfixed price. This year's collection and storage price is a fixed price set by the country after comprehensive consideration of domestic and international factors. This year's purchase and storage will be sold at this price. It is expected that in the future, the state's regulation of cotton prices will be regulated through the establishment of the price for storage and storage. It can be predicted that the annual price of cotton purchasing and storage will continue to rise in the future.

After the crash, people worry about soaring. Zhang Yanlin, research director of China Investment Consulting Co., Ltd., said that if cotton farmers are again affected by market conditions and adopt blindly follow-up planting plans, the declining area of ​​cotton production areas will greatly affect cotton production, and this is bound to set off a new round of cotton prices." Roller coasters" once again frustrated the industry chain. Affected by this high-frequency price shock, some SMEs in the industrial chain will be pushed to the edge of life and death and will further restrict the development of the industry.

In fact, this worry is likely to become a reality next year. Ma Junkai introduced that many farmers have used cotton to plant cotton. Judging from the current statistics, the cotton planting area in Dezhou City will be reduced to 1.4 million mu in the next year, a year-on-year decrease of one-eighth.