September 18, 2012 Institutional Watch - Cotton Futures

Main points

1. Price Bulletin: domestic lint: 129 level 20499 yuan / ton; 229 level 19628 yuan / ton; 328 level 18752 yuan / ton; 428 grade 17914 yuan / ton.

Domestic textiles: polyester staple fiber 10390 yuan / ton; viscose staple fiber 15780 yuan / ton; C32S price 25630 yuan / ton.

2. domestic stock: on the 14 day, domestic cotton spot prices continued to operate smoothly, but enterprises were more pessimistic about the overall market outlook.

In recent days, the volume and paction price of reserve cotton have continued to decline, showing that textile enterprises are weak in demand for cotton and are cautious in purchasing raw cotton.

3. imported cotton: in September 14th, the price of China's main cotton imports rebounded, and most varieties rose 0.25 cents, which is negligible compared with the recent decline.

On the whole, there was no significant change in downstream demand. Last week, China signed a 60 thousand ton US cotton contract, sparking speculation in the market about China's acquisition and storage of cotton.

4. cotton throwing and storage: in September 17th, the planned sale of cotton reserves was 44841.71 tons, and the actual turnover was 17066.91 tons, with a turnover rate of 38.06%.

The 328 class cotton price is 18617 yuan / ton (public weight), up 57 yuan / ton compared with September 14th, which is 140 yuan / ton lower than the national cotton price B index (CNCotton B) 18757 yuan / ton.

5. the purchase and storage of new cotton: in September 14th, China cotton reserve management company plans to store and store 50000 tons of cotton in 2012, and the actual turnover is 1520 tons, with a turnover rate of 3.04%.

6.ICE cotton: in September 17th, the dollar index began to pick up as the market's optimism on QE3 declined, which brought pressure to the commodity market.

ICE phase cotton after low rise power is obviously insufficient, although the intraday rose to 76.77 cents, but the late rapid diving to the December contract fell to 20 days below the average.

Summary:

At the same time, the storage and storage of the reservoir is carried out at the same time, the price is different.

The price of cotton in Chinese society is reflected more truthfully.

After the purchase and storage starts, the cotton resources will flow to the national reserve.

But before the global demand for cotton has obviously improved, the three tier structure of cotton prices will not change. The circulation price of cotton in China will close to 20400 of the purchase and storage price. However, closing up is far from being able to achieve.

The specificity of China's cotton base determines that QE3 has little effect on it.

We recommend a strategy of low price and focus on the 40 and 60 day moving average.

[MEIKO futures] industry fundamentals are still weak, the upward trend of cotton during the period of macro lifting.

Overnight, the US dollar index began to pick up and pressure on the commodity market as the market's optimism about QE3 declined.

ICE phase cotton after low rise power is obviously insufficient, although the intraday rose to 76.77 cents, but the late rapid diving to the December contract fell to 20 days below the average.

QE3's stimulus to the market is relatively short, and the expected reduction in China's consumption demand will hinder the rise.

News, according to Vietnam Youth magazine September 14th, Vietnam Textile Association (Vitas) said that in the first 8 months of this year, Vietnam's textile trade surplus amounted to $5 billion 300 million, an increase of 24% over the same period last year.

One of the reasons for the increase in trade surplus is that raw material prices are lower than in previous years, especially cotton prices fell by nearly 40% over the same period last year.

Another reason is that the export enterprises in the country have changed their previous processing modes and exported products through the FOB mode, thus increasing the added value of the products.

International market, in September 17th, ICE futures rose, the price of China's main cotton imports rose sharply, and cotton, cotton, Brazil cotton and Central Asian cotton rose by 2.3-2.7 cents, while West African cotton and India cotton rose 1.5 cents.

Last week, foreign cotton spot trading became more active, and the US cotton export weekly also let market participants think about it, and the Fed's QE3 finally "boots landing", the cotton market seems to add a bit of optimism.

However, the fundamentals of the cotton market are still weak. In the long run, cotton prices can not be supported by consumption.

Domestic market, 17, domestic cotton spot prices continue to operate smoothly, the paction is relatively light.

At present, the cotton spot market is running under the dual regulation of purchasing and storing, throwing and storing. The purchasing and storage policy is the main support for keeping the cotton price stable at present. Recently, the monthly report of the USDA has increased the anticipation that the industry will further reduce domestic cotton demand. If the downstream textile market can not recover, the pressure of cotton price will continue to increase in the later stage.

National Reserve dynamics: 1 and September 17th, the sale of reserve cotton was 17 thousand and 100 tons, and the turnover rate was 38.06%. As of that date, the total sales volume of the reserve cotton was 234 thousand and 200 tons, with a turnover rate of 48.60%.

2, in September 17th, the national cotton temporary storage and storage business was 2760 tons. As of that date, the total annual cotton purchase and storage paction in 2012 reached 5680 tons, of which 3480 tons were traded in the mainland and 2200 tons in Xinjiang.

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Spot quotation, September 17th, the US C/A cotton 91.90 (cents / pound), discount general trade port delivery price 15624 yuan / ton (according to sliding tax calculation); Australia cotton 96.90, discount general trade port delivery price 16235 yuan / ton; Uzbekistan cotton 92, fold the renminbi trade port delivery price 15637 yuan / ton; West Africa cotton 88.85, discount general trade port delivery price 15230 yuan / ton; India cotton 87.10, discount general trade port delivery price 15009 yuan / ton.

CNCotton A 19628 yuan / ton; CNCottonB 18757 yuan, up 1 yuan.

Market analysis, the current poor capacity of the industry, the pressure of supply makes cotton price action can not be enough.

The domestic market threw the store to ease the slight tension of high-grade cotton, and began to buy and store. With the volume, the market will be boosted.

In the near future, the fine and good cotton period started the defending war at the 60 day moving average, and the trend of the internal and external markets was basically the same.

On the operation, most of them are backed by 60 day moving average.

[GF futures] storage and storage at the same time, Zheng cotton weak shock

[market performance]

Cotton futures on the US Intercontinental Exchange (ICE) fell on Monday, ending the gains of the previous two trading days, but the decline was milder than that of oil and other major commodities. In December cotton CTZ2 fell 0.57 cents, or 0.8%, at 75.33 cents a pound, trading in the range of 75.12-76.77 cents.

The 1301 contract of the Zhengzhou mercantile exchange closed at 19580 yuan / ton, up 70 yuan / ton compared with the previous day.

Turnover increased to 78334 hands, and positions were reduced by 9904 to 221964.

[spot market]

Cotton spot quotation maintained a slight rebound, and the deal was dull.

The national cotton index is two yuan cotton, 19400 yuan, and the three grade cotton price is 18637 yuan / ton, up 0 yuan / ton on the previous trading day.

[industry news]

As of the 14 th, the total amount of cotton put in has been 217131.09 tons, with a cumulative turnover of 49.68%. The average grade is 3.07, the average length is 27.88, the average weighted price is 18564 yuan / ton, and the turnover price is 328 yuan / 18637 yuan / ton.

[operation suggestion]

QE3 only promoted the US cotton for a day and made no contribution to Zheng cotton.

Domestic dumping and storage volume totaled more than 210 thousand tons, the proportion of pactions has been declining, throwing storage is about to end in September 29th, has a certain support for cotton prices; purchase and storage began to appear a small number of pactions, daily turnover less than 2 kilotons.

After the end of the storage, Zheng cotton or a little boost, but pay attention to how the weak spot market is high.

Price linkage, it is recommended that more than 19700 of the above meet the high level of weight loss.

[Wanda futures] the collapse of the external market dragged down the US cotton downward

Affected by the harvest pressure in the United States, and rumors that the early harvest is higher than expected, including the technology driven selling of the fund driven multi position, the price of soybeans, corn and wheat plummeted all over the world. Crude oil prices were also hard to escape. Oil prices were estimated to fall by nearly 3 US dollars / barrel. The fall in the commodity market drove cotton prices down. ICE cotton fell 0.57 cents to 75.33 cents / pound, although the standing price was 75 cents / pound, the downward trend of cotton prices was obvious.

In the case of widespread weakness in the peripheral market and low supply of loose supply in cotton, the future downtrend may continue, and the December contract will continue to challenge the 75 cents / pound pressure level.

Monday ICE cotton small Yin collection, although the main contract in December stabilized 75 cents / pound above, but short-term average line turn downward downward trend has formed a short order, KD and MACD indicators continue to fall short, MACD index green column growth, the market weakened, December contract will continue to challenge 75 cents / pounds support position, if the support is lost, the trend will continue, otherwise continue to 75-77.5 cents / pound of the horizontal area.

China's current round of storage and sales ended in September 29th, and textile enterprises' auction enthusiasm rebounded. On Monday, 17067 tons were traded, and the turnover rate rose to 38.06%, and 2760 tons of storage and storage were received, of which 1680 tons were traded in Xinjiang.

Although the policy supports the market, cotton prices are relatively weak as a whole. The large number of RPG highlights the downturn in downstream demand. Some textile enterprises can keep their stocks until the end of the year. The reduction of circulation resources caused by the new cotton purchase and storage will not cause too much impact on them.

On the other hand, at present, the cost of acquisition in Xinjiang is generally around 19000 yuan / ton, slightly lower than the price of zhengmian 1301. Due to the fact that part of the problem is not yet clear, some enterprises have a futures market value preservation plan.

At present, Zheng cotton is obviously unable to attract textile companies to buy in. In this case, Zheng cotton is hard to get rid of the horizontal pattern. It is expected that Tuesday.

Will follow the commodity down, continue to hold 1301 contracts empty list, short-term target 19400 yuan / ton line, such as support for the loss of additional holdings to 19000 yuan / ton line.