Zhengzhou Commodity Exchange has reached 10 Xinjiang cotton futures delivery warehouses

As of now, there are 10 cotton futures delivery warehouses in Xinjiang, and the delivery warehouse capacity accounts for 77.8% of the total cotton futures delivery warehouses in the country. The construction of the Xinjiang cotton futures delivery warehouse has reduced the cotton futures delivery costs of cotton-related enterprises in Xinjiang and greatly improved the efficiency of cotton futures delivery.

From January 1, 2020 to May 21, 2021, the registration volume of Xinjiang cotton delivery warehouse warehouse receipts has reached 1.31 million tons, accounting for 64% of the total registration volume of cotton delivery warehouse warehouse receipts nationwide. Among them, more than 50% of the cotton warehouse receipts in Xinjiang delivery warehouses are generated in the Huankuitun City area, which has become the core delivery benchmark area for cotton futures.

In recent years, Xinjiang has vigorously developed the textile and clothing industry, and Xinjiang’s local cotton consumption has increased simultaneously. Therefore, in September 2017, the Zhengzhou Commodity Exchange moved the benchmark delivery location of cotton futures to Xinjiang, and accelerated the construction of cotton futures delivery warehouses in major cotton production and distribution centers such as Kuitun City, Shihezi City, Korla City, and Bachu County in Kashgar Prefecture. The number of Xinjiang cotton futures warehouse receipt registrations has grown rapidly.

“The transfer of the cotton futures benchmark delivery location to Xinjiang will increase the pricing power of Xinjiang cotton, which is extremely beneficial to the development of Xinjiang’s cotton industry. The establishment of a cotton delivery warehouse in Xinjiang will help Xinjiang cotton-related enterprises reduce the cost of cotton futures delivery. Improve the efficiency of cotton futures delivery and enhance the ability of Xinjiang cotton-related enterprises to use futures tools to avoid price risks.” said the relevant person in charge of Zhengzhou Commodity Exchange.

With the volume of warehouse receipts reaching a record high, Xinjiang cotton delivery warehouses fully cooperate with the China Fiber Inspection Bureau to carry out sampling and inspection work to ensure the quality of cotton warehouse receipts. At the same time, ensure safe storage of warehouse receipts and smooth entry and exit of warehouses. Most large and medium-sized cotton enterprises in Xinjiang have participated in the futures market.

Cotton futures have become the basis for spot trade pricing. Zhengzhou Commodity Exchange has given full play to the power of futures, and through “insurance + futures” pilots, setting up delivery warehouses, supporting warehouse receipt financing and other methods to protect the income of farmers in Xinjiang and promote industrial development. With the effective function of cotton futures, as the mainstream model of international bulk commodity pricing, the basis trading model combining futures and spot has gradually replaced the traditional “fixed price” trading model. , becoming the mainstream of the cotton trading market.

Warehouse receipts are an important tool for cotton-related enterprises to carry out cargo pledge and financing. Cotton warehouse receipt pledge financing, over-the-counter comprehensive platform warehouse receipt trading, warehouse receipt repurchase and other businesses have reduced the financing costs of cotton-related companies and broadened financing channels. In 2020, national cotton-related enterprises raised a total of 6.6 billion yuan in warehouse receipt financing through the Zhengzhou Commercial Exchange’s over-the-counter business platform, ranking first in the Zhengzhou Commercial Exchange’s ranking of existing financing amounts.

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