Quota distribution is still the focus of cotton spinning enterprises
On September 29 this year, the National Development and Reform Commission announced the quantity, application conditions and allocation principles of cotton import tariff quotas for 2019. As in previous years, the number of cotton import tariff quotas is 894,000 tons, of which the proportion of quotas issued to state-owned trading enterprises is 33%. The basic conditions for companies applying for cotton import tariff quotas have not changed. The focus is once again on the issuance of additional cotton quotas and the adjustment of sliding taxes.
The cotton gap is slowly increasing
Looking at the overall cotton situation this year, whether it is the total cotton output of 7.58 million tons statistics from the China Cotton Association, or the estimated data of 7.26 million tons from the national cotton trading market , the industry generally believes that cotton output has not changed much and is basically the same as last year.
In terms of cotton consumption, according to relevant data released by the National Development and Reform Commission, the national yarn output from January to October this year totaled 16.1759 million tons, a year-on-year increase of 17.3%. According to a survey by the my country Cotton Association, my country’s cotton consumption will reach 12 million tons this year, and the domestic cotton gap will reach 4.42 million tons.
At the recently held China International Cotton Textile Conference, Ma Zhanping, deputy director of the Economic and Trade Department of the National Development and Reform Commission, pointed out in a report submitted to the conference
that based on the current cotton production situation, textile production and export situation, It is expected that affected by the appreciation of the RMB, reduced export tax rebates and rising labor costs, the growth rate of my country’s textile production and textile exports will slow down in 2019, but the demand for cotton is still increasing, and the annual cotton production and demand gap is expected to further expand.
The increase in the gap between cotton supply and demand indicates that textile companies’ demand for imported cotton will further increase, and the amount of quotas issued should also increase
.
Enterprises use quotas intensively
In 2007, the state issued a total of 3.494 million tons of cotton quotas, including 894,000 tons of quotas within tariffs and 2.6 million tons of quotas under sliding tariffs. Relevant statistics show that as of the end of October this year, my country had imported a total of 2.035 million tons of cotton. Based on this calculation, companies currently have at least nearly one million tons of cotton quotas that have not been used up, and it is now impossible to return the quotas. In order to respond to the declaration of next year’s quotas for T7<~5, many companies began to intensively use quotas at the end of the year.
El Qian, the person in charge of a textile company in Anhui, said that the quota allocated to medium-sized textile factories like theirs is already very limited, with a total of only more than 900 tons, and 400 tons have not been used up to this day. He believes that it is very likely that the country will lower the sliding tax next year. In addition, the domestic cotton production and demand gap is large, and the quota will be very popular by then. Therefore, in order not to affect the number of applications for next year, they decided to import a batch of Indians in the bonded area in the near future. cotton.
A certain company in Jiangsu also reported that they currently have 2,000 to 3,000 tons of quota that have not been used up and plan to use it before the end of the year. Due to its preference for imported cotton, the factory has already booked cotton for shipment in December, but it needs next year’s quota to clear customs. At present, the company has declared next year’s cotton quota.
There is a lot of controversy over the sliding scale tax
When talking about quotas, we must mention the sliding scale tax. In May 2005, the state began to implement a sliding tax policy on cotton imported beyond the quota. Through this relatively flexible tariff system, it tried to lock in the domestic sales price of imported cotton and avoid the impact of low-priced foreign cotton on the domestic cotton industry.
Sliding quasi-tax has been implemented for more than two years. Industry analysts believe that the implementation of the sliding quasi-tax policy has played a positive role in stabilizing domestic cotton prices, and has also affected my country’s cotton imports and even the fluctuations of the international cotton price index. It has a certain inhibitory effect, but it has had little effect in protecting the interests of cotton farmers.
Since the beginning of this year, textile companies have encountered pressures such as rising raw material prices, rising labor costs and loan interest rates, RMB appreciation, and lower export tax rebates. The living environment has been difficult. Therefore, quota restrictions on imported cotton have been removed or the sliding tax has been reduced. The voice is relatively high.
In late July this year, the National Development and Reform Commission held two meetings of all parties on the issue of whether to relax cotton tariff restrictions, but they failed to reach an agreement due to large differences.
However, the relevant person in charge of the Tariff Department of the Ministry of Finance said, “Although the control objectives of the cotton sliding tax have been basically achieved,
we believe that there is still room for further improvement of the sliding tax. We will follow closely Regarding the implementation of the sliding tax, we must carefully analyze domestic and foreign cotton supply, demand and price trends, and on the premise of maintaining the basic stability of the sliding tax form, work with relevant departments to further improve it when necessary.”
Relevant people called on , the country should further adjust the sliding tax calculation formula in the short term so that Chinese cotton import companies can decide the quantity of cotton imports based on the international market price.
The sliding tax quota will not be extended
As the end of the year approaches, there are more discussions about whether the sliding tax quota should be used up. On the one hand, companies are using quotas intensively, and on the other hand, they are also hoping that this year’s quota validity period will be extended. So has the validity period of the quota been extended?Is it possible? When reporters interviewed Zhu Dongfang, director of the Economic and Trade Department of the National Development and Reform Commission, he said with certainty: “The sliding tax quota will not be extended.”
Zhu Dongfang also said that in 2019 The time for the issuance of 894,000 tons of imported cotton tariff quotas has not been determined yet, and relevant departments are still undergoing further negotiations, but it is certain that it will be issued to enterprises in the first half of next year. Asked about the situation of additional quotas, he said that the current total cotton production has not been reported to the National Development and Reform Commission. It depends on the new cotton production. If the production is high, the quota will be issued less or not. If the production is small, more quotas will be issued. When a reporter asked about the pros and cons of the sliding scale tax that has been implemented for more than two years and possible modifications, he said, “We are studying it. This is a very complicated matter and it has not yet been determined.”
As someone in the national cotton trading market said, the end of the year is approaching, cotton textile enterprises’ 2007 annual quotas will be used intensively, 2019 annual tariff quotas will be issued, and the new year’s sliding tax policy will also be released soon. The impact on the market will be concentrated. AAEHRYJUTUTHYER
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