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Cotton Shorts Trend Remains

2011/6/17 9:25:00 60

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At the end of May, due to the continuous drought in China, small scale replenishment of textile enterprises was carried out. cotton Spot prices have seen a rally. In mid June, domestic rainfall increased, drought eased, and sales of textile downstream products remained difficult. Cotton prices once again stopped rising.

Global cotton expansion, drought in Dezhou is hard to conceal.

Due to the continuous drought in Dezhou, the largest cotton producing area in the United States, the US Department of agriculture's report in June lowered the output of US cotton in 2011 from 218 thousand tons to 3 million 701 thousand tons, and the total output of the whole world was also reduced by 208 thousand tons to 26 million 947 thousand tons, but it still increased 2 million 64 thousand tons compared with 2010. Global cotton expansion, the southern hemisphere Brazil and Australia cotton has increased production and listing, although Dezhou drought has an impact on the output of cotton in the United States, but it has little impact on the global cotton production situation. In addition, China's consumption will be cut 109 thousand tons to 10 million 342 thousand tons, and global consumption will be reduced from 120 thousand tons to 25 million 899 thousand tons. Shrinking consumer demand also counteracts the effects of adverse weather.

Domestic cotton expansion, mainland weather has limited impact on total output.

According to the latest prediction of China Cotton Association, in 2011, the cotton planting area reached 81 million mu, an increase of 5.2% over the previous year, down 1 million 80 thousand mu compared with its 82 million 80 thousand mu forecast in April. The May cotton production survey released by China cotton information network also estimated that the national cotton planting area in 2011 was 81 million 340 thousand mu, which was slightly lower than that in April. The prediction data of authoritative organizations in the two industries are close, and the increase of new cotton planting area is no longer suspense. At present, the new cotton sowing has ended, and the new cotton grows poorly in the Yangtze valley because of drought after drought. The largest producer in China Xinjiang The new cotton is growing well, weakening the adverse effects of adverse weather conditions on cotton production.

　　 Spinning enterprises Sporadic purchase, gauze inventory increase

In late May, there was a small-scale replenishment of textile enterprises. Cotton spot turnover increased and cotton prices rebounded during the following period, or about 1000 yuan / ton. However, downstream sales of textile enterprises are still sluggish, and the rise in cotton prices can not be transmitted to the downstream. According to the survey of cotton textile enterprises with a total volume of 12 million 300 thousand spindles at the end of May according to the China cotton information network, the textile enterprises adhere to the principle of "buying and using according to their needs". At the end of May, the stock of textile enterprises decreased, and yarn and grey fabric inventories increased. In addition, the survey found that the ratio of cotton distribution to textile enterprises also showed a downward trend.

Inventory survey of cotton textile enterprises in late May

Pressure on cotton enterprises to repay loans is urgent. Selling cotton is a top priority.

According to the policy of Agricultural Development Bank, the ratio of repayment of cotton enterprises by the end of June should be around 80%. In the face of the pressure of repayment of loans, there are also cotton enterprises to sell cotton as quickly as possible. By the middle of June, the results of the replenishment of textile enterprises expected by cotton enterprises were not satisfactory. In recent years, cotton prices are hard to rise when cotton companies are actively selling cotton, or have dropped due to concentrated selling.

Zheng cotton shifted to the warehouse for a long time, and was short in short and medium term.

Since late May, Zheng cotton 1109 has been moving to the far month contract, and 1201 has become a new main contract. The sharp decline in the 1109 contract position also displaced the speculation in the early stage. Technically, the short and medium term trends of the 1201 contracts are in short order. In the main position, the top 20 seats are open space. Combined with the current macro environment and the fundamentals of cotton, it is expected that Zheng cotton will continue to oscillate in the near future. However, the weather factor is still the key to cotton production. If the bad weather conditions are upgraded later, it will start another round of bull market again.