One Word: "Cotton Flies" -- Make People Happy And Worrying.

In 2010, along with the textile industry's export situation, the price was rising.

With regard to cotton speculation, cotton prices have risen from 10000 yuan / ton to 32302 yuan / ton, and the price of ten years has been fried. In the face of such a "cotton flying smell" that was so hyped in 2010, the agriculture analysis of Eiger is as follows:

First, the impact of supply and demand is the basic factor determining cotton prices. Domestic cotton production has remained low for two consecutive years.

Judging from domestic demand, the total consumption of spinning cotton in domestic enterprises above Designated Size reached 11 million 240 thousand tons in 2009/10, and the total demand reached 11 million 380 thousand tons. In the same year, the output was only 7 million 246 thousand tons, and the gap between production and demand was 4 million 130 thousand tons.

The domestic sowing area in 2010/11 was basically the same as last year, and the critical period of growth again encountered adverse weather. The output of cotton was only 7 million 315 thousand tons.

According to the study of Iger agriculture, the total demand of cotton in 2010/11 is 11 million 140 thousand tons, and the annual production demand gap is 3 million 828 thousand tons. The gap between supply and demand in two consecutive years is close to 4 million tons, forming strong import demand, and China's import demand is close to 40% of world trade volume.

In the international market, the global supply and demand basically balance in 2010/11, the output is slightly larger than the demand, and the safety factor has picked up. However, the strong import demand determines that the Chinese market will have a strong pulling effect on the world market and drive the global cotton prices up.

Domestic and international cotton prices have reached a record high by echoing the domestic and international markets.

Second, from the macro economic situation, the extremely low interest rates of the world's major economies, the global liquidity surplus caused by the extremely loose monetary policy, the serious inflationary pressures of the world, and the serious gap between production and demand in China make cotton become the image of excessive hot money speculation, thus deciding the larger fluctuation of the cotton market.

The excessive rise of cotton prices in 2010 is largely driven by macroeconomic instability and may continue to affect the larger fluctuation of cotton prices in the year 2011.

Third, from the perspective of China's money supply and GDP growth rate, the central bank's higher currency issuance is also a leading factor in promoting the overall rise in domestic prices.

As an obvious supply and demand gap, cotton prices have become inevitable. The increase will exceed the gap between the increase in GDP and the increase in the issue of money. Therefore, the price of cotton will rise substantially in the first half of 2011.

Finally, regarding the production aspect in 2011, the price of lint cotton may increase by 50% or so, as the price increase of seed cotton in 2010 is estimated to be between 40%-50%. The profit of cotton planting has been restored to a certain extent. Cotton production is expected to return to nearly 8 million tons per year, and the safety factor has picked up.

International cotton production will continue to grow, and there will be a surplus of cotton supply worldwide.

It is expected that when the new cotton is listed in 2011, the purchase price may fall considerably, but when the price is reduced to about 22000 yuan / ton, the state may start the minimum cotton purchase price mechanism at this price level to stabilize the cotton price and ensure the stability of the cotton production.