Zheng Cotton Opened High &Nbsp Down; Market Short-Term Shocks Are More Risky.

ICE cotton gained a new high around 1, due to the severe drought in Dezhou, the main cotton growing area, which offset the earlier fall in the market due to weak data in the US. ICE's new contract rose 1.77 cents in December, 1.3727 dollars per pound, and 2.30 cents in July, at 1.6097 dollars a pound.

Fang Huiling, futures analyst at Xiangcai prayer year, said that the drought in the US producing area continued to rise in the ICE period. The strong atmosphere of agricultural products will support the price of Zheng cotton. But the macroeconomic situation is worrying, the domestic cotton industry situation is still in the doldrums and the Dragon Boat Festival will usher in the central bank's proposed rate increase window does not support the continuous rebound of Zheng cotton short term, and the frequent short term operation of the main bodies also increases the risk of market fluctuations. With the approaching of the Dragon Boat Festival, the market will be more worried about tightening policy, and there will still be a risk of callback in the short term.

Senior government officials said India may postpone its scheduled meeting in June 2nd. The meeting will decide on the export of more cotton. India's annual export quota of cotton is 5 million 500 thousand bales. The Ministry of agriculture has been striving to increase the export quota of 1 million 500 thousand packages in 2010/11, while the Ministry of textiles has opposed it to prevent price rises. The ministerial group composed of the textile Ministry, the Ministry of agriculture, the Ministry of trade and the Ministry of finance will make decisions on export issues.

Recently, the drought in Texas has escalated, and all non irrigated cotton fields have been seriously affected, and the market is worried. Some farmers in Dezhou are about to get the deadline for giving up cotton crops, only to get insurance compensation. Insiders predict that cotton production in 2011/12 is likely to be reduced by 40-50% over the previous year.

Ministry of industry and the Institute of industrial economics of the Chinese Academy of Social Sciences jointly issued the 31 spring report on China's industrial economic operation in 2011. It is believed that China's industrial economy is facing difficulties in increasing the cost of storage, tight supply of electricity, financing difficulties of small and medium-sized enterprises, increasing inventory, and so on.

In the latest PMI index of May, the new order index, backlog order index and raw material inventory index dropped significantly, all over one percentage point, indicating that the downstream situation is still poor.

The cotton spot is basically stable, and there are spot quotes rising in some areas. The market still looks dull but hidden behind it. On the one hand, domestic cotton traders' confidence has been restored; on the other hand, few textile factories are purchasing a small quantity. On the 1 day, the price of Xinjiang cotton in Shandong area is 26200-26500 yuan / ton, and the quality is good. But not all textile factories are good. Some small factories are still shutting down production, limiting production and even closing down. The industry shuffle is inevitable. 1, China's cotton price refers to (CCIndex328) 24495 yuan / ton, up 17 yuan, 527 cotton to plant average price 22578 yuan / ton, up 29 yuan.

The enthusiasm of textile enterprises to purchase cotton is still not high. With the purchase of raw materials, cotton stocks remain at a low level. At present, the biggest problem facing the textile enterprises is the difficulty in sales of cotton yarn, the tight capital flow, and the relatively good sales in the gray cloth market, mainly because of the deep decline and large loss of the products such as the cotton and grey fabrics in the early stage, especially in the case of the downtime of the weaving mill, the idea of maintaining stability of the enterprises is enhanced, and some enterprises' quotations are no longer reduced.

In June 1st, the average price of electronic contracts of commercial cotton in the national cotton trading market continued to rise, and the increase continued to expand. The main MA1108 contract closed at 25570 yuan, up 402 yuan; in recent months, the MA1106 contract closed at 25030 yuan, up 76 yuan. Trading volume increased slightly and orders decreased.

On the international side, the ICE cotton reached a new high around 1 days, due to the severe drought in the main cotton growing areas of Dezhou, which offset the earlier fall in the market due to weak data in the US. ICE's new contract rose 1.77 cents in December, 1.3727 dollars per pound, and 2.30 cents in July, at 1.6097 dollars a pound. On the domestic side, zhengmian futures closed up on the 1 day, and the 1109 contract in recent months reported 26235 yuan / ton, up 235 yuan, or 0.90%, the highest 26450 yuan / ton, the lowest 26090 yuan / ton, shrinkage of the warehouse; the 1201 month contract was 24755 yuan / ton, rising 105 yuan / ton, that is 0.43%, the highest 0.43% yuan / ton, the lowest yuan yuan / ton, the market shrinkage increased.

Technically, in recent months, the 1009 contract has opened up a concussion and closed down the small Yin line. The price has been blocked at 26500 front-line, but it is still running above 26000. Far from 1201, the contract was blocked by the 25000 and 60 day moving average, running near the upper track of the brin channel. The market contracted and shred, and RSI and KDJ showed signs of turning around. Judging from the position of the top 20 positions, the new lake futures have substantially reduced their holdings by more than one 10546 hands. At the same time, they have increased 3074 holdings of empty stocks, and the number of institutions has been reduced more. The frequent short-term operation of the main long-term institutions has increased the risk of market fluctuation, and short positions are still relatively heavy, which makes the market pressure upward.