Zheng Shengwei, Department Manager of Xiamen ITG, delivered his report of New landscape in yarn production and circulation and strategies for purchase and sale

The report is divided into two parts.

1.Analysis of capacity layout and production competition in textile enterprises. Capacity layout trends (rapid globalization), with Xinjiang cotton yarn production capacity leading domestically. Xinjiang's capacity is rapidly growing, with expected some inland capacity cuts. The integrity of the industry chain, complete upstream and downstream support, in line with diversified and efficient demand, multiple factors promote the cooperation between upstream and downstream to meet the high circulation demand, with perfect matching of raw materials highlighting China's advantage in non-cotton fibers, manufacturing cost comparison (equipment efficiency).

2.Consideration of yarn circulation new pattern and purchasing and sales strategy. The new pattern of yarn circulation (empowering the traditional supply chain triangle), traditional sales and purchases transitioning to modern sales and purchases, considerations for the rhythm of yarn purchasing and sales, and introduction of yarn purchasing and sales strategies. He also taks about the utilization of futures: transition from unilateral price speculation to basis competition in the traditional futures-spot trading model, and cotton yarn futures outlook (expecting trading volume recovery after expanding of delivery).