The Shortage Of Resources Is Limited, And The Adjustment Is Limited.

ICE is the direct reason for the adjustment of the market in order to raise the margin level in order to prevent the warehouse from being squeezed out.

Observing the ICE main contract in May, we can find that since January 25, 2011, the contract's turnover and position have significantly increased, and by February 18th, the growth rate is 144.8% and 190.1% respectively, and the market risk is beginning to accumulate.

ICE announced that it raised the speculation and hedging margin of cotton (30325, -655.00, -2.11%) futures to $8400 / hand and $6000 / hand starting from Wednesday, nearly 4 times the increase.

Affected by this, all the funds came out, resulting in a continuous price limit.

The situation in Africa and the Middle East exacerbated the extent of market pullbacks.

The Yemen crisis and the Iran warships entering the Suez canal also stir up waves in the market. For a while, the world capital market is worried about the spread of the sentiment.

The NYSE crude oil April contract rose from $87.09 in February 16th to $100 / barrel in 23 days, up 14.82% in a few days.

The Dow Jones index fell 1.44% on the 23 day, and the Japanese stock market, European stock market and Australian stock market also fell.

The world commodity market, which was originally on the rise, also stopped abruptly and began to adjust itself from high position.

The international cotton market has accelerated the decline speed on the basis of the original adjustment.

Internal cotton adjustment master

There are technical adjustment requirements in the domestic and foreign cotton market.

From the ICE cotton contract in May, it began to rise from November 24, 2010. During the period, there has been no decent adjustment. In the later stage, under the oppression of squeezed storage, there was an accelerating trend.

Since September, the main contract of zhengmian has appeared from the beginning of February 9, 2011, and there has been a phenomenon of upward fatigue and index divergence. Although the period has reached a record high of 34870 in February 17th, market adjustment has actually breeds.

The shortage of resources is limited, and the adjustment is limited.

The international market has limited resources and the short atmosphere is difficult to eliminate in the short term.

According to the statistics of the US Department of agriculture, as of February 10th, the total amount of cotton contracted in the US 2010/2011 reached 3 million 369 thousand tons, completing 97% of the USDA forecast, that is, the surplus left in the United States.

Despite the increase in cotton planting area in the southern hemisphere in the new year, there are still many uncertainties.

The main cotton producing countries in the southern hemisphere, such as Brazil, Australia and southern Africa, have been affected by the high cotton prices last year. The planting area has generally increased. However, due to the growing season and weather and insect pests, it is difficult to predict how big the output will be.

The shortage of supply resources in China has not been fundamentally improved, and the market is expected to run at a high level.

According to China cotton information network January cotton inventory survey of textile enterprises, as of the end of January, China's textile enterprises have 1 million 262 thousand and 300 tons of cotton stocks, and the total domestic cotton business inventory is 2 million 970 thousand tons (including cotton and cotton into the circulation link, excluding national storage cotton), total inventory of 4 million 232 thousand and 300 tons.

It is difficult to cope with the cotton demand in the next few months under the normal growth situation.

In summary, the domestic and foreign cotton market adjustment is reasonable, but the adjustment time is not long.

It is also unrealistic to expect the price to go down sharply under the influence of resource supply factors.