August 13, 2012 Institutional Watch - Cotton Futures

Main points

1. Price Bulletin: domestic lint: 129 level 20294 yuan / ton; 229 level 19436 yuan / ton; 328 level 18524 yuan / ton; 428 grade 17617 yuan / ton.

Domestic textiles: polyester staple fiber 9730 yuan / ton; viscose staple fiber 15050 yuan / ton; C32S price 25380 yuan / ton.

2. domestic stock: the problem of "purchasing, storing, throwing and storing quotas" has been affecting the nerves of cotton prices. With the closing time of storage, the price of cotton will fall, but it will be difficult to rise.

3. imported cotton: in August 10th, the price of imported cotton in China's main port was mixed, but the rate was small, and the overall stability remained.

In the near future, the market is more interested in the USDA supply and demand report due to the emergence of bad market and more favorable news.

At present, the order quantity of textile mills is still insufficient, and the interest in foreign cotton purchase is not one of the main factors to restrain cotton price rising.

4.USDA: according to the global cotton supply and demand forecast released by the US Department of agriculture (USDA) on 10 th, the global cotton output in 2012/13 is 24 million 844 thousand tons, which is expected to increase by 64 thousand tons compared with July. The consumption of 23 million 548 thousand tons in the new year is reduced by 179 thousand tons, the trade volume is 8 million 100 thousand tons, the reduction is 40 thousand tons, the end of the stock is 16 million 257 thousand tons, the increase is 495 thousand tons, and the stock consumption reaches 69.04%, which is increased by 4.71 percentage points compared with 2011/12 year.

5.ICE cotton: in August 10th, the USDA supply and demand report disappointed the market. In addition to the reduction of global cotton consumption in the market expectations, the unexpected increase in global cotton production and terminal stocks led to a heavy setback in ICE futures.

In the wake of the USDA report, the sell-off has sprang up, with a 4% decline in December and the biggest one-day drop in two months.

Summary:

The two major factors that affect domestic cotton prices are demand and policy. There is no substantial change in demand.

With the approaching of the new cotton year, cotton enterprises expect cotton prices to come closer to the purchase and storage price. Under this expectation, there is limited space under zhengmian.

In August 10th, the USDA supply and demand report disappointed the market. Besides the reduction of global cotton consumption in the market expectations, global cotton production and terminal stocks unexpectedly increased, and ICE futures suffered heavy losses.

Zheng cotton recently or will be affected by the bad news and weak performance.

However, in view of the different policy factors at home and abroad, the author insists that the idea of lowering the middle line is not enough.

[MEIKO futures] good data expected to fall short of cotton or down

Overnight, the USDA supply and demand report disappointed the market in August 10th. In addition to the global cotton consumption cut in the market expectations, the unexpected increase in global cotton output and terminal stocks led to a severe setback in ICE futures.

In the wake of the USDA report, the sell-off went to a large margin, with a 4% decline in December and the biggest one-day drop in two months.

At present, cotton prices have sped up most of the previous gains, which may oscillate between 70-75 cents in the future.

On the news side, the US Department of Agriculture announced the latest forecast of global cotton production and storage in 2012/13: global supply and ending inventory have increased.

At the beginning of the year, the stock was raised by 244 thousand tons; output increased by 65 thousand tons; consumption decreased by 179 thousand tons; the end of the world inventory was adjusted to 16 million 258 thousand tons, an increase of 496 thousand tons from last month, of which China increased by 518 thousand tons.

It is worth mentioning that China's final inventory of 7 million 442 thousand tons is equivalent to 46% of the end of the world inventory.

International market, August 10th.

The price of main ports in China is mixed, but the rate is not large, and the overall stability is maintained.

In the near future, the market is more interested in the USDA supply and demand report due to the emergence of bad market and more favorable news.

At present, the order quantity of textile mills is still insufficient, and the interest in foreign cotton purchase is not one of the main factors to restrain cotton price rising.

And the news that India and other main cotton producing countries are not conducive to the growth of cotton can break through the short defense line. The data released by USDA will play an important role.

From the data released, the global supply exceeding demand pattern is hard to break, and cotton prices return to the weak market.

Domestic market, domestic cotton spot price runs smoothly.

At present, the shrinking demand caused by the global economic recession is the core factor that restricts the rise of cotton prices. The market has been affecting the nerve of cotton prices around the issue of "collecting and storing, throwing and storing quotas". With the approaching of storage time, cotton prices will fall, but it will be difficult to rise.

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Spot quotation, August 10th, the US C/A cotton quotation is 91.85 (cents / pound), the discount general trade port delivery price is 15614 yuan / ton (calculated by sliding tax), the Australian cotton quotation is 97.10, the general trade port price is 16332 yuan / ton, the Uzbekistan cotton quotation is 95.10, the general trade port delivery price is 16054 yuan / ton, the West African cotton price is 88.60, the general trade port delivery price is 15190 yuan / ton, the India cotton quotation is 88.10, the general trade port delivery price is 15126 yuan / ton.

The national cotton price A index was 19443 yuan / ton, up 1 yuan; the B index was 18532 yuan, up 2 yuan.

Market analysis, according to the monthly supply and demand data released by USDA on Friday, the inventory, output and ending stocks at the beginning of the world have increased, while consumption has been cut down, and good expectations are lost, leading to a sharp fall of nearly four percent of ICE cotton.

Overall, the lack of speculation, lack of speculative capital and the high pressure of market forces exist objectively.

The price is difficult to get rid of the consolidation interval or weak.

On the operation, the external market crashed on Friday. Today, we are concerned about the support of the 60 day moving average.

[Wanda futures]USDA monthly profit fell sharply

In August, the USDA monthly report lowered India's output from 108 thousand tons to 5 million 117 thousand tons as expected in the year of 2012/13, but China's output increased by 109 thousand tons to 6 million 750 thousand tons, and the US output increased 142 thousand tons to 3 million 843 thousand tons. The global output thus increased 64 thousand tons to 24 million 844 thousand tons, but the global consumption was reduced from 179 thousand tons to 23 million 548 thousand tons, of which China's consumption dropped from 109 thousand tons to 23 million 548 thousand tons.

Global supply was still over 1 million 296 thousand tons in the current year, and the final stocks rose sharply from 495 thousand tons to 16 million 257 thousand tons, of which China's final stocks increased by 517 thousand tons to 7 million 441 thousand tons. The report is out of the market forecast. This shows that cotton market is still in a severe supply demand situation, which has led to a sharp decline in the ICE cotton market on December. The main contract in December fell 2.93 cents to 73.02 cents / pound. The expected decline will continue in the next few days, and the December contract will challenge 70 cents / pound strong support position.

Friday ICE cotton fell sharply, the main 12 contract closed at 75 cents / pound, although cotton prices stabilized on the short-term average, the short-term average line has a trend of continuous upward trend, but KD and MACD indicators at high position once again formed a downward trend in the downward trend, MACD index red column shortened, cotton prices weakened, the callback trend will continue, December contract will once again challenge the strong support position of 70 cents / pound integer.

The USDA monthly report, while raising the inventory and output at the end of the year, lowered the consumption of 109 thousand tons to 8 million 491 thousand tons in 2012/13, and the actual consumption may be much lower than that.

On the other hand, judging from the recent changes in Zheng cotton storage capacity, although the new year is drawing near, the government will open and store the new cotton (19285, -95.00, -0.49%) at the price of 20400 yuan / ton, and will take the initiative to liquidate the cotton price.

It is difficult to shake off the weak pattern.

The rumor about dumping and storage is coming back again. The market rumors will sell 50 thousand tons of cotton from its own stores. The supply of the market is still loose, and the textile enterprises' affordability is limited. The low consumption is the main reason that restricts cotton prices.

It is expected that Zheng cotton will fall sharply under the pressure of USDA monthly report on Monday, and the 1301 contract will challenge 19100 yuan / tonne pressure level. If the support is lost, it will continue to increase its holdings and target to 18600 yuan / ton line, otherwise it will rely on the support to cash in some of the profits.