August 14, 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. cotton imports: on the 13 day, due to a sharp decline in ICE futures on last Friday, the price of China's main port of import cotton was down sharply, of which the US cotton, Australia cotton, India cotton and Brazil cotton fell 3 cents, while other varieties also fell by 1-1.5 cents, and the price of long staple cotton rose slightly.

Recently, domestic and foreign cotton prices have risen slightly with the help of the main cotton producing weather and China's purchasing and storage policy, but last week's USDA monthly report poured cold water on the market.

The continued loosening of the cotton market in the new year will create greater resistance to stabilizing and rebounding cotton prices.

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: on 13 February, the weather conditions improved in the US grain production area and the poor global demand outlook overshadowed the market. ICE futures continued the trend of last week's downtrend. After the December contract fell below the average price line of 10 days, the technical selling took place, leading to a further decline in cotton prices.

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, the global cotton production and terminal stocks increased unexpectedly, and ICE futures continued to overrun.

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 every drop in the central line will gradually be incorporated into many single ideas.

[German futures] unclear direction, Zheng cotton weak shock

Monday CF1301 low concussion, CF1301 closed more than 10.7 hands trading, holding a slight decrease.

CF1301 closed at 19275 yuan / ton, down 105 yuan / ton, reduced 186 hand; in August 13th, China imported cotton (FC Index M) 87.49 cents / pound, fell 2.09 cents / pound, 1% yuan tariff reduced price 14099 yuan / ton, sliding price conversion price 14925 yuan / ton.

According to New York's August 13th news, ICE cotton fell nearly 2% on Monday to its lowest point in a week. Mengyin's market continued its downward trend due to technical selling and global demand outlook.

The ICE12 cotton contract fell 1.33 cents or 1.8%, and the settlement price was 71.69 cents per pound.

In August 13th, the cotton trading market of the national cotton trading market reached 14280 tons, an increase of 2000 tons from the previous day, an increase of 2580 tons of orders, and a total purchase of 143860 tons.

On the 13 day, the market contracts were opened and the market was in turmoil.

The volume of orders is concentrated in the medium-term contract.

Monday low shocks, the initial rebound temporarily suspended, the market lost obvious direction, the possibility of sideways shocks is greater, it is suggested that investors should deal with short term trading or wait-and-see within a day.

Today's operation suggests that the CF1301 reference price range is 19100-19400 for short term pactions.

[Wanda futures]USDA monthly report continued to drag down ICE cotton with external commodity down

A small amount of rainfall and cooling next week will bring relief to the drought affected corn and soybean crops in the Midwest of the United States. On Monday, grain prices fell across the board. Meanwhile, USDA's bad monthly report continued to affect the ICE cotton market. Due to the prospect of high inventory consumption demand and Monday, ICE cotton continued to be hit by selling. The contract fell 1.33 cents to 71.69 cents / pound in December, and the lowest price was 71.59 cents / pound. Cotton prices continued to have a trend of callback, with a trend of 70 cents / pound strong support.

Monday ICE cotton continued to fall, the main 12 contract fell below the short-term average line support, although the short-term average has the trend of continuous upward trend, but the KD and MACD indicators in the high position again fell short, the 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.

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Although the USDA monthly report was extremely bad on Friday, global and Chinese stocks at the end of the year hit a new record. At the same time, the euro zone economy was in recession, and the global textile industry was in decline.

Consumption has shrunk, and global and Chinese consumption has been cut down. However, as China is about to enter the new year, the government will open its stores at a price of 20400 yuan per ton, which offset the bad data. On Monday, Zheng cotton only fell slightly.

As China's cotton price is still much higher than the international cotton price, the competitiveness of China's textile and apparel in the international market has not recovered, exports continue to shrink, downstream consumption continues to deteriorate, and the overall market lacks confidence in cotton prices.

In this case, the short-term price of Zheng cotton continues to decline, and it continues to hold 1301 empty contracts. The short-term target is 19100 yuan / ton, and the 1301 contract breaks through 19400 yuan / ton short term pressure level.

[MEIKO futures] market lacks favorable support period cotton shock weak

Overnight, the market in August 13th was overshadowed by improved weather conditions and poor global demand in the US grain production area. ICE futures continued the trend of last week's downtrend. After December's contract fell below the 10 day average price, technical selling began, leading to a further decline in cotton prices.

USDA supply and demand report has a negative impact, and cotton prices will continue to suffer downward pressure.

On the news side, the monthly report of the US Department of agriculture in August suggested that China's cotton yarn imports have increased significantly in recent months, and the import of cotton and textile products has also increased correspondingly.

China's strong demand for imported cotton yarn will inhibit cotton imports.

Compared with the previous two years, the increase of cotton yarn imports this year is equivalent to 435 thousand tons of cotton.

The international market, in August 13th, was affected by the sharp decline of ICE futures on last Friday. The price of China's main port of import cotton was completely reduced, of which the US cotton, Australia cotton, India cotton and Brazil cotton fell 3 cents, while other varieties also fell by 1-1.5 cents, and the price of long staple cotton rose slightly.

At home and abroad, cotton prices were slightly raised with the help of the main cotton country weather and China's storage policy, but last week's USDA monthly reported a pot of cold water to the market.

The continued loosening of the cotton market in the new year will create more resistance for the price to stabilize and rebound.

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.

Spot quotation. In August 13th, the quotation of C/A cotton was 88.85 (cents / pound), the general trade port delivery price was 15245 yuan / ton (calculated by sliding tax), Australia cotton quotation was 94.10, the general trade port price was 15935 yuan / ton, the Uzbekistan cotton price was 94.20, the general trade port price was 15952 yuan / ton, the West African cotton price was 87.60, the general trade port delivery price was 15086 yuan / ton, the India cotton quotation was 85.10, the general trade port delivery price was 15549 yuan / ton.

The national cotton price A index was 19448 yuan / ton, up 5 yuan; the B index was 18532 yuan / ton, unchanged.

Market analysis, from the monthly supply and demand data released by USDA, the global initial inventory, output and ending inventory increased, while consumption was downgraded, and good expectations were lost, leading to a continuous decline in ICE cotton futures.

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

Price or volatility is weak.

In operation,

Yesterday fell below the 60 day moving average, short-term recommendations wait and see.