Analysis Of Cotton Price In International Market From 1 To September

1 - September

From 1 to September, the Cotlook A index and the US cotton futures price were 86.94 cents / lb and 81.66 cents / lb, respectively, representing an increase of 45.53% and 54.5% over the same period last year.

From the supply and demand situation, the world's cotton output has risen sharply this year, which is expected to restrain rising price trend. Meanwhile, factors such as insufficient production and continuous decline of inventory will still have an impact on cotton prices.

(1) cotton production has increased significantly, and is at a time of centralization, which will have a certain inhibitory effect on the continuous rise of cotton prices.

The US Department of Agriculture reports that global cotton production is 25 million 410 thousand tonnes in 2010/11 (beginning in September 2010), an increase of 15.12% over the previous year, and the rate of output reduction for three consecutive years has changed, which is basically the same as the average annual output since 2004/05.

The main production country, the United States output is 4 million 110 thousand tons, increase 54.82%; India output is 5 million 660 thousand tons, increase 12.07%; Brazil output is 1 million 520 thousand tons, increase 30.85%.

Global cotton production has increased substantially, and supply and demand has improved. At the time of the cotton harvest in the northern hemisphere, the volume of listed resources can meet short-term market demand, and cotton prices continue to rise.

(two) consumption will increase and inventory decline will support cotton prices.

As the overall growth of the global economy is getting better, cotton consumption needs to pick up.

World cotton consumption is projected to be 26 million 300 thousand tonnes in 2010/11, basically recovering to the level of consumption before the global financial crisis. It is only behind 2006/07 and 2007/08 consumption in history, an increase of 2.57% compared with the previous year.

Judging from the relationship between production and demand, cotton production has increased substantially, but compared with demand, there is still a gap of 890 thousand tons. In the fifth consecutive year, insufficient production is needed, and inventory needs to be remedied. The global cotton stocks will continue to decline.

It is estimated that the end of world cotton inventory in 2010/11 will drop to 9 million 720 thousand tons, a decrease of 4.94%, the lowest level in nearly six years.

The inventory consumption ratio was 37%, the lowest level since 1996.

Because of the shortage of production and the decline in inventory, the price of its support is unlikely to show a sharp decline.

(three) speculation in speculative capital will increase the fluctuation of cotton prices.

Since July this year, the harsh climate of some major agricultural products (21.86, -0.59, -2.63%) in Europe and America and Asia has brought uncertainty to future supply, and speculative capital has taken this opportunity to pour into the agricultural futures market for speculation.

New York futures exchange data show that as of the end of September, cotton futures non commercial positions were 78804 hands, more than the 34386 increase in the middle of this round of cotton price rise in mid July, an increase of 77.41%.

Speculation in speculative capital will also increase the price fluctuation of cotton.