The end of the year is approaching. Looking back at the progress of the cocoon silk industry in the past year, the price of cocoon silk has been running at a high level for a long time. Perhaps it can be described by the phrase "there is no highest, as long as it is higher". The cocoon silk market in 2010 is undergoing a slow rise. Since the silk price climbed to the 200,000 yuan mark at the end of 2009, it has continued to maintain a high upward trend this year, and has exceeded the 400,000 yuan mark so far (in mid-December). The silk price of 400,000 yuan is unique in the history of the cocoon silk industry. The trend of commodity prices is one of the basis for judging whether an industry’s development is good or bad, but price changes are complicated.

The prices of agricultural products have generally risen, and the price of cocoon silk has risen. "Choose the right side and stand in the right team"

In 2010, the prices of most agricultural products, including silkworm cocoons, have risen in turn, and they have been renewing their historical highs in their respective fields. "Do you play" and other online new words with a ridiculous nature continue to appear. Everyone is an agricultural product. Why can't you increase it? Although cocoons and silk are small commodity varieties, they are not as closely related to people's livelihood consumption as other agricultural products. , But it also keeps up in this round of rising prices of agricultural products.

Researcher Li Guoxiang, deputy director of the Macroeconomic Department of the Rural Institute of the Chinese Academy of Social Sciences, shows that in 2003, especially since 2004, my country’s agricultural product prices have experienced several rounds of significant increases in just a few years. Therefore, agricultural product prices are now cyclical. The volatility theory is difficult to explain, and it is more likely to rise in turns, one product after another, one product after another. "Everyone's rise is the real rise"-this year's cocoon silk price is so high-profile, it seems so natural and confident.

For the increase in agricultural product prices this year, some people attribute it to four major reasons: changes in the supply of agricultural products caused by weather and natural disasters; increased demand for agricultural products purchase and processing; loose monetary policy environment; artificial hype intervention. However, some experts pointed out that these are structural, phased, and seasonal factors, and there are deeper reasons for the trend of rising prices of agricultural products. "The hype is just adding more force to the actual price increase."

The cost of production increases the value of the product to determine its price

The prices of silkworm eggs, mulberry seedlings, pesticides and fertilizers and other agricultural materials have risen. It is destined from the source that the price of silkworm cocoons will not be low. High dry cocoon and raw silk prices. When the price of raw silk exceeded the price of 300,000, we were speculating and looking forward to the price of 350,000. Now 350,000 has long been history, and 400,000 has come to our eyes. At the same time, with the increase in land rent, especially the lack of labor, labor costs have increased. When visiting various silkworm producing areas in Guangxi, we often hear complaints like this: "The times are different now, manpower is expensive, and many young people are reluctant to endure hardship. We are the only ones who are old and weak here, let alone in the city. Finding a good job, even being a construction worker, will make more money than helping people to raise silkworms, and the risk is not that big." When facing most of the farm work, including mulberry planting and silkworm rearing, the rural labor force estimates that more of them will only choose to "go out."

Regarding land, which is a necessary means of production for agricultural production, some experts believe that with the rapid increase in land occupied by cities, land resources have become more and more scarce, and land prices have become a long-term trend. In particular, the compensation for land acquisition in the suburbs of some large cities is getting higher and higher, which greatly increases the cost of agricultural land. “Therefore, the deep-seated and trending reason for the price increase of most agricultural products is the rigid increase in the cost of farming.” An economic evaluator said.

Against the background that my country’s CPI continues to hit high in each month of this year and the era of inflation has already come, the rise in prices of agricultural products is inevitable for the development of my country’s industrialization and urbanization to a certain stage. It is necessary and reasonable for the price of agricultural products to rise steadily, which is in line with farmers' reasonable demands for hedging the increase in farming costs, and is conducive to protecting farmers' enthusiasm for production. In the past 30 years, the purchase price of agricultural products in my country has risen by less than five times, while the wages of urban workers have increased by more than 10 times, and in some areas it has reached more than 30 times. From last year to this year, the purchase price of silkworm cocoons has continued to rise, objectively benefiting farmers. Especially in Guangxi where the purchase of silkworm cocoons is highly market-oriented, silkworm farmers have directly benefited from the rising price of cocoon sales, and their enthusiasm for planting mulberry and sericulture has increased. . If farmers engaged in agricultural production are often on the verge of loss, or have little profit, under the impact of the acceleration of urbanization and the boom of the industrial economy, imagine how many people are willing to do these tasks?

From the perspective of demand, some people believe that the price is not determined by the production cost alone, but must be accepted by the demand side. The price of 350,000 and 400,000 silk is undoubtedly a huge price for downstream production distributors. Pressure, if there is no support from demand, silk prices will soon fall, and the price of cocoon silk will rise when there is no news that the terminal consumption of silk has increased significantly. This is not the true performance of the market supply and demand relationship, and it must be artificially hyped. That's why the price of silk is so high. However, it cannot be denied that even if it is the influence of human factors, the market needs to have the corresponding conditions in order for human factors to take effect. The current market situation is that the price of silkworm cocoons this year is very high. The average price of fresh cocoons is generally around 35 yuan/kg. The price of silk produced from this part of raw materials cannot be lower than 330,000 yuan, and my country’s raw silk importers ——India’s adjustment of the import raw silk policy and the introduction of duty-free raw silk procurement measures have been stimulating the continuous increase in the price of raw silk in my country. Regardless of whether there is a substantial increase in silk consumption, it has given people a psychological hint for a good export orientation.

Psychological expectations of production reduction, feelings become a "stimulant" for the high market

Although statistics show that the output of silkworm cocoons this year has increased, and the country’s total annual output is likely to exceed 600,000 tons, there are also many buyers who report that "cocoons cannot be bought" and "good cocoons cannot be bought."

In the first half of the year, due to the continuous drought in autumn, winter and spring, mulberry cultivation in Yunnan, Guangxi and other regions were affected, and there were expectations of a reduction in spring cocoon production. In the absence of comprehensive and accurate statistics on the output and quality of each cocoon season Under the premise, it is difficult for us to conclude whether to increase or decrease production, but for many silk companies, raw material prices are high, and the dry cocoon resources circulating in the market are the "sweet and pastry" that everyone is robbing, even if it is the number one in the country. In Guangxi, a large silkworm cocoon province, some silk reeling plants also purchase dry cocoons in Yunnan and other provinces. Some manufacturers reported that the number of silkworm cocoons purchased this year has decreased by 30% compared with the same period last year, which cannot meet the production demand until May next year. The competition for limited resources will further intensify. Such psychological expectations have provided the cocoon silk price with a certain degree of motivation and support to continue its upward movement.

Analysis and Prospects of Several Factors Affecting the Future Cocoon Silk Market

2010 is a key year for my country to maintain stable and rapid economic development and accelerate the transformation of its economic development mode. It is also a key year for the cocoon and silk industry to continue to recover. Looking at the overall domestic and international economic situation, the situation facing the cocoon and silk industry next year will be more complicated and unpredictable, with opportunities and challenges coexisting, and there are still many uncertainties in the industry's economic recovery.

Influencing factors are mainly manifested in the following aspects:

(1) Domestic market

Favorable factors:

1. Beginning in 2010, my country’s macro economy as a whole has maintained a steady growth momentum, GDP growth has accelerated, investment structure has been optimized, exports have rebounded significantly, and domestic demand has remained strong.

2. With the continued improvement of the macro economy, the textile industry adjustment and revitalization program, and the active promotion of fiscal policies, the demand and consumption of clothing and home textile products have achieved accelerated growth, which is also conducive to the growth of the domestic market for silk-related products.

3. The market momentum and policy momentum for the growth of domestic consumption consumption are abundant. Since 2010, the domestic consumer confidence index has reached its highest point since 2009. The fiscal policy remains active in improving people's livelihood and expanding consumption, and will create more domestic demand in the middle of next year, which will play a positive role in driving the silk domestic demand market.

Disadvantages:

1. All aspects of monetary policy tightening have been adjusted, and the pressure on industry funds has gradually increased. Coupled with the significant pressure on the appreciation of the renminbi, it may have a certain negative impact on the silk industry, which is deeply dependent on the export market for a long time.

2. The purchase price of silkworm cocoons hit a new high in 2010. If silkworm farmers are not strengthened with information guidance and rationally arrange production, the scale of mulberry planting and silkworm breeding does not match the demand for raw materials, which will lead to a new round of price collapse, which is not conducive to the relative balance of cocoon silk supply and demand.

3. For downstream silk companies, the continuous increase in comprehensive costs will put more pressure on business profitability. If the bargaining power of the company's products cannot be improved, the "cocoon silk upside down" situation does not rule out the possibility of recurrence, the pressure on the operating environment of the industry has not been reduced, and the phenomenon of large-scale losses of the company may reappear.

 (2) International market

Favorable factors:

1. After entering 2010, the global economy bottomed out after the financial crisis and showed a trend of recovery, laying a good foundation for development in 2011. The World Bank and the International Monetary Organization successively raised their forecasts on global economic trends in 2010. The global economic outlook and market sentiment have become increasingly optimistic. The improvement of the external environment is conducive to promoting silk consumption.

2. Developed economies have increased consumer confidence and demand rebounded. Developing economies have basically achieved a steady rise, and both consumer demand and industrial support demand have improved significantly. The overall recovery of the international market in 2010 will be the main focus, and the industry's exports may generally show a trend of recovery in 2011.

3. Commercial inventory orders in major markets have seen an obvious increase. In particular, silk exports have been declining for four consecutive years, and commercial inventories have been at a low level. Replenishment orders will inject strong short-term growth momentum into silk export growth. Driven by inventory demand, silk exports are expected to show a rapid growth trend in the first half of next year. However, with the return of real demand in the order market, the growth rate of industry exports may slow down in the second half of the year.

4. Market demand from India and Pakistan has become an important force supporting exports. After the 2008 financial crisis, with the "ebb" of European and American orders, India and Pakistan's silk imports accounted for an increasing proportion of China's silk exports, and the relationship was relatively stable due to factors such as religion, ethnicity, and climate. In the second half of this year, the news that India imported 2,500 tons of duty-free raw silk through a state-owned company will have further implementation measures in 2011.

Disadvantages:

1. Trade protectionism in various countries and regions still exists. Even if it is one of the major importing countries of silk, while importing duty-free raw silk, it continued to initiate an anti-dumping sunset review investigation against real silk satin in 2010. The EU's REACH regulation sets a hidden "threshold" for silk and other textiles, and it is also a technical barrier to international trade.

2. Although the economies of major silk export markets have stabilized and rebounded, they are still faced with problems such as high unemployment, debt crisis, and deflation to varying degrees. The inhibitory factors of their market consumer demand have not been significantly reduced. Therefore, the economic recovery situation of the main market is still unclear, and the start of external demand in the silk industry is significantly later than that of other industries. It is expected that the export of silk products will show a slow recovery trend.

In 2011, the development of the cocoon and silk industry was a coexistence of opportunities and challenges, and the overall trend of recovery was good. However, various uncertain factors still exist, especially the excessively high price of cocoon silk may have a certain impact on the newly emerging domestic silk consumption. A macro grasp of the industry's operation direction, timely adjustment of development strategies, and a correct grasp of market trends require relevant competent departments, organizations and enterprises to jointly exert their wisdom and collaboration spirit to prevent the industry from experiencing major ups and downs and allow the ancient industry of silk to continue to rejuvenate.