The adjustment of national cotton policy, from purchasing and storage to direct subsidy, will stabilize cotton planting on the one hand, and enhance the competitiveness of cotton textile enterprises in the international market on the other, which will maintain the smooth operation of cotton textile industry chain in the long run.

Cotton is one of the special main agricultural products in China, and its economic value can only be realized through circulation; As a big cotton user, China relies on imports for part of its cotton demand. However, from the historical data, the global cotton harvest area fluctuates greatly and is difficult to predict. The long cotton textile industry chain enlarges the foam component of the gap between supply and demand, which leads to the continuous fluctuation of cotton prices. Since the market-oriented reform of cotton circulation system in 200 1, China has carried out temporary storage and storage for eight years to stabilize cotton planting.

The purchasing and storage policy can effectively stabilize cotton prices, but the disadvantages are also obvious, that is, the price difference between domestic and foreign cotton weakens the international competitiveness of cotton textile enterprises. According to Haitong's calculation, since the latest purchasing and storage policy was implemented on 20112, the price difference between domestic cotton and foreign cotton (the difference between domestic cotton price and foreign cotton price) began to expand rapidly in May of 20 10 and 20 12. 20 14 In mid-April, the state announced that the purchasing and storage policy was changed to direct subsidy policy, and overseas cotton prices fell rapidly. The cotton price difference at home and abroad expanded rapidly from 20 1500 yuan/ton in April to 4,000 yuan/ton in July, and the cotton price difference remained at 4,000 yuan/ton in August and September.

The root of direct subsidy policy lies in the high cost of cotton planting in China (compared with the United States and India). By subsidizing farmers, on the one hand, the cotton planting area is stabilized from the source to ensure the annual cotton supply, on the other hand, the circulation price of cotton market is reduced, that is, the cotton procurement cost of cotton textile enterprises is reduced.

We judge that the cotton price will drop to about 6.5438+0.5 million yuan/ton in the future. September-165438+1October is the new cotton picking period of 20 14/20 15, during which cotton circulates freely. After 165438+ 10, it is expected that the country will restart cotton throwing (there are still 100000 tons of reserve cotton). The dumping price will drop sharply on the basis of the last round of dumping price 17250 yuan/ton (the grade of stored cotton will drop after the new cotton is listed), and the current cotton futures price (CF 50 1) will drop to1/0 yuan/ton (September 19).

Pay attention to the "dilemma reversal" of high-cost operation of cotton textile industry since 20 10: since 20 10, the costs of raw materials, production and financing have risen sharply, weakening the competitiveness of cotton textile enterprises in the international market. In addition, exchange losses and trade barriers also directly swallowed up the profits of enterprises.

Since 20 10, the price of cotton, the main raw material of cotton textile, has been influenced by policies and funds, and the fluctuation direction and amplitude are difficult to predict, which interferes with the operation of enterprises and amplifies the fluctuation range of enterprise performance. The introduction of direct subsidy policy will obviously suppress the cotton price difference at home and abroad. Mainly affected by funds, the cotton price of 20 10 rose rapidly from15,000 yuan/ton in March to 31/0,000 yuan/ton, and then quickly fell back to 65,438 in August. With the introduction of cotton direct subsidy rules, it is expected that cotton prices will drop sharply in the future. Considering that the domestic cotton reserve is still around100000 tons, it is expected that the cotton price will fluctuate in a narrow range at a low level in the next two years, and the price difference between domestic and foreign cotton is expected to drop significantly.

Taking Jiangsu, Zhejiang and Fujian textile industry clusters as examples, the average annual wage increase of 1995- 199 is 12%, 13% and 14%, respectively. The data of 2000-2004 are respectively. From 2005 to 2009, the average annual growth rate was 13%, 12% and1%respectively, but after 20 10, it was 2010-20/kloc. In addition to the natural increase in wages, the enterprise welfare in welfare expenditure has increased obviously due to the change of population employment structure (staff accommodation, entertainment, entertainment and other expenses). We predict that in the future, the wage level of manufacturing personnel may stabilize at an average annual growth rate of 10%, which is basically consistent with the income growth rate; However, the labor costs in Southeast Asian countries are accelerating. Take the minimum wage in Vietnam as an example. In 20 1 1-20 14 years, the minimum wage was raised from1550,000 guilders to 2.7 million guilders, an increase of nearly 80%.

In addition to wages, environmental protection costs in production costs have also increased significantly in recent years. Take Shaoxing, Zhejiang Province as an example, Keqiao District (more than 70% of printing and dyeing enterprises in Shaoxing are concentrated in Shaoxing City and Keqiao District). The latest sewage treatment cost of Sewage Treatment Department 20 14 is the benchmark cost of 3 yuan/ton. The higher the pollutant concentration in a ton of water, the higher the cost, reaching 10 yuan/ton. If printing and dyeing enterprises choose to build their own sewage treatment equipment, the cost is about 1.5-2 yuan/ton, and the investment scale is generally tens of millions, and the equipment investment accounts for about 5%- 10% of the annual income scale. We judge that the environmental pressure of textile enterprises has basically peaked.

We reiterate the investment logic of leading cotton textile enterprises and recommend Hua Fu Color Spinning, Blum Oriental and Lutai A. ..

In the short term, it is expected that the performance of leading cotton spinning enterprises will be more flexible in 20 15 years: since the announcement of the cotton direct subsidy policy in April, the cotton industry chain expects that the cotton price will drop sharply after the new cotton is listed, and downstream customers in all links of the industry chain are cautious in placing orders (short order cycle, tendency to digest inventory, and price suppression behavior), and cotton spinning enterprises are facing certain short-term pressure; The downward trend of cotton prices is conducive to the normal operation of the industrial chain, that is, we believe that the order volume and gross profit margin of 20 15 leading cotton textile enterprises will be significantly improved, thus bringing greater performance flexibility.

In the medium term, the high-cost dilemma of cotton textile enterprises since 20 10 is expected to begin to reverse on 20 15. Since 20 10, cotton textile enterprises are facing the dilemma of rising costs. With the natural increase of labor cost, the peak of environmental protection cost and the decline of cotton price, cotton textile enterprises are expected to usher in 20 15. Upgrade the textile sub-industry rating to "overweight".

The main uncertain factors. The overseas market demand is not up to expectations, and the downward speed of cotton prices is too slow.