Focus Of Cotton Market: Analysis Of The Reasons For The Sudden Rise Of Cotton Market At Home And Abroad Recently

 

Since the end of August, cotton market at home and abroad has been the focus of global agricultural products market

First, from August 31 to October 31, the March contract of main American cotton fell 44.79 cents / pound in 46 trading days, with a cumulative decline of 38.95%;

Second, from August 29 to October 31, the 2201 contract of zhengmian main force fell by 3010 yuan / ton in 40 trading days, with a cumulative decline of 19.70%.

What is puzzling is that, with the stable supply and demand relationship in the global and domestic cotton market and no change in market expectations, the contract price of the main US cotton companies in March rose by 17.66 cents / pound, or 25.15%, in a short week (five trading days) from October 31 to November 4. During the same period, the price of 2201 contract of zhengmian main force increased by 1200 yuan / ton, or only about 10%.

From the perspective of high cotton production in the United States and other major countries, the main reason for the sudden increase of cotton production in the United States and other countries is that the cotton market in the United States is sharply reduced due to the high cotton production in the United States. However, every sudden and large market start is not so simple.

Analysis of the reasons for the sudden rise in recent days can be found as follows:

First, there are large short profit positions in American cotton and domestic cotton market, which are waiting to be settled;

Second, there is a strong demand for correction of excessive downward price in technology;

Thirdly, there are too much rainfall in India and other production areas, and there are variables that change the yield;

Fourth, the macro level has improved. For example, the market expects that the subsequent high-intensity interest rate increase of the Federal Reserve will be "unsustainable".

In addition to the specific factors such as high cotton price and cotton planting price rebound this year, it is also an important factor to push forward the cotton price rebound and low cotton planting cost. For example, in recent years, with the international cotton price and Zheng cotton futures price continued to rise, the domestic cotton spot market reluctant to sell price sentiment increased.

At present, the number of new orders for domestic sales in domestic textile market is less, and the orders of textile mills on machine are also reduced. It is estimated that the new orders in the year will not be as high as the same period last year, and the production and sales activity of the textile market has decreased. At the same time, the whole order of knitted fabric is not good, and the goods for woven clothing and low count grey cloth are not good. Some textile mills believe that raw material prices still have room for decline.

As the main cotton production in the international market is still difficult to determine, although the downstream demand is not optimistic, the probability of cotton price oscillation upward is relatively large. Judging from the development of domestic cotton market, up to now, Xinjiang's new season cotton picking work is coming to an end, but seed cotton sales progress is slow. It is estimated that 40% to 50% of seed cotton in the northern Xinjiang region are in the hands of cotton farmers, and about 30% in the southern Xinjiang region. For zhengmian's main 2301 contract, about 13000 yuan / ton may be a relatively recognized price.