Cotton: Uplink Space Is Limited.

At this time of the year, new cotton was already on the market in large quantities. But this year, due to the implementation of the Cotton Subsidy Policy in Xinjiang, the stalemate and game between cotton growers and ginning plants delayed the time of centralized listing.

Before the National Day holiday, Zheng cotton, which was "crazily" rising, maintained a slight oscillation trend in recent days.

In the current cotton market "no longer", cotton prices go up difficult, later with the new cotton list, Zheng Mian may fall again.

The latest global cotton demand and supply data released by the US Department of agriculture (USDA) show that the volume of global cotton market oversupply in is further narrowed compared with 2013/2014, to 1 million 239 thousand tons, far below the 2 million 436 thousand tons in 2013/2014.

Global cotton inventories have seen a steep upward trend in recent 4 years.

Even if China's cotton inventory data were removed, the end of last year's inventory and inventory consumption data remained high.

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The pattern of supply and demand is similar to that of the global market.

In 2014/2015, cotton production in China was predicted to be 6 million 641 thousand tons, down 490 thousand tons from the previous year, consumption of 8 million 274 thousand tons, an increase of 762 thousand tons over the previous year, and 1 million 524 thousand tons of imports, a sharp reduction of 1 million 551 thousand tons compared with the previous year.

In the new year, the dynamic supply of China's cotton market may be short of 109 thousand tons.

However, last year, the end of the cotton inventory of about 13000000 tons, far exceeding the domestic consumption in a year.

Will continue to suppress cotton prices up.

In addition, with the implementation of Xinjiang cotton direct subsidy policy, the difference between domestic and foreign cotton prices is expected to narrow.

Prices will therefore be under pressure.

Since 2010, the difference between domestic and foreign cotton prices has been at a high level. Until April 1, 2014, the domestic reserve cotton auction bid price dropped from 18000 yuan / ton to 17250 yuan / ton, and the difference between inside and outside cotton prices was narrowed, but then expanded again.

In the new year, the focus of international cotton prices has shifted downward, and the domestic and foreign cotton prices have been narrowed again (especially in the 1% quota).

According to the data, as of October 11th, the difference between the inside and outside cotton prices was 3125 yuan / ton under the sliding tax, and the discount rate was 941 yuan / ton under the 1% tariff quota.

It is understood that this is because the quota of cotton imports in China this year has severely restricted the quota of many Chinese buyers. On the other hand, some foreign businessmen have increased the proportion of the contract margin of imported cotton to 15% to 20%, which has restrained the import of cotton to a certain extent.

With the implementation of Cotton Subsidy Policy in Xinjiang, the price of domestic cotton is greatly weakened by the policy, and will be determined by market supply and demand in the future.

Domestic cotton prices will continue to be weak in the expectation of continued narrowing of domestic and foreign cotton prices.