US Cotton Exports Suffered A Contract Cancellation Of &Nbsp; Cotton Fell Kinetic Energy Failure.

After a long decline, at present, Zheng cotton 1201 contract fell to 21500 near the point, as prices close to the national purchase price, the decline kinetic energy began to fail, and gradually built the bottom signs.

Global

The US Department of agriculture's July supply and demand report lowered global cotton production and consumption in 2011/2012, while raising futures inventories.

Among them, the reduction in output was mainly due to the decline in cotton production in the United States. The reduction in consumption came from the decline in cotton demand in China, India and Pakistan. On the one hand, the increase in final inventory was due to a reduction in global consumption over production. On the other hand, due to the cancellation of cotton export contracts in the US cotton market, the end of 2010/2011 inventory increased.

The data itself has a negative impact on cotton, but compared with the two month report in 6 and July, the final inventory increase in July was mainly due to a sharp reduction in consumer demand. But if the abnormal weather in the US cotton planting area has not been alleviated, the output will probably continue to decline. And with the pickup of cotton export volume in 2011/2012, the consumer demand will be further reduced.

So bad reports can be seen as negative.

American cotton

As the number of textile mills cancelled more than the new contract volume, the net contract volume of US cotton exports remained negative, mainly due to the decline in demand for cotton in textile enterprises.

According to the report of the China cotton storage information center in July 1st, there was no sign of improvement in the operation of textile enterprises, and the stock of products increased, and the price of cotton yarn and cotton cloth continued to decline.

Most cotton factories in the domestic textile enterprises can keep their stocks until the end of this year.

On the 30 day of June, the US cotton export weekly data showed that before the change of US cotton exports in the week of 2011/2012, the downturn continued.

On the one hand, the market is worried about the reduction in the export volume of the new cotton market in the new year. On the other hand, it shows that after a long decline, buyers are more recognised for the current price.

China's cotton output is expected to increase in the new year, but the uncertainty is bigger.

According to the national cotton market monitoring system June 17 - 30 survey report, it is expected that in the late normal weather, the output of new cotton can reach the expected 7 million 390 thousand tons, an increase of 18.61% over last year.

Cotton growth is now entering the flowering and boll stage of yield determination, and the uncertainties in the later stage are still large.

At present, the main cotton growing areas in China are relatively normal, but some areas also suffer from severe weather.

In addition, some farmers in cotton area showed that there were slight pests and diseases on cotton plants.

Therefore, later weather, pests and other factors still have an impact on output.

The purchase price of national cotton supports futures prices

At the beginning of this year, the national development and Reform Commission and the Ministry of agriculture jointly issued the "2011 cotton temporary purchase and storage plan", and decided to implement the temporary storage and storage system in 13 provinces throughout the country.

This year, the temporary storage price is 19 thousand and 800 yuan per ton of standard grade lint to the warehouse, which can be regarded as the cost support price of cotton. After a long decline, cotton futures price is close to the national cotton purchase price, and there is little room to fall.

Market outlook

At present, Zheng cotton is still in a difficult way to explore and seek support, technical indicators are still empty, but the weekly MACD has gradually formed signs of gold fork. It is expected that the 1201 contract will gradually build the bottom line in the 21000 line.