October 17, 2012 Institutional Watch - Cotton Futures

[Hongyuan futures] U.S. cotton volume rose

Main points

1. Price Bulletin: domestic lint: 129 level 20514 yuan / ton; 229 level 19641 yuan / ton; 328 level 18782 yuan / ton; 428 grade 17940 yuan / ton. domestic Spin Product: polyester staple fiber 10900 yuan / ton; viscose staple fiber 14890 yuan / ton; C32S price 25690 yuan / ton.

2. domestic stock: 15, domestic cotton spot prices continue to operate smoothly. At present, the progress of new flower picking has been quickening in all cotton producing areas of the country, and nearly 60% new flowers have been picked up in the country. However, due to various factors such as market demand, purchase and sale price difference and purchasing and storage policy, both cotton enterprises and cotton traders are very cautious.

3. cotton imports: in October 16th, the price of China's main port of imported cotton continued to rise, of which 1 cotton cents, Brazil cotton and India cotton rose, and West African cotton rose 0.75 cents. At present, the number of downstream orders is insufficient, and the short list is the main reason. The rising price of cotton continues to inhibit the purchasing demand of textile mills.

4.ICE cotton: in October 16th, Spain was considering the application of credit lines to the EU to boost the market, the US dollar fell sharply, and US stocks also showed the largest single day increase since September 27th. Affected by this, ICE futures have attracted market buying, while high cotton micron values in the southeastern United States have led to investor concerns. A surge of buying has pushed the December contract to a high of 75.17 cents.

Summary:

In the downturn of global economic growth and the difficult problem of cotton demand in the long term, it is difficult to solve the three stage structure of cotton price in China market. USDA and the WASDE released in October 11th further reduced the demand for cotton in China in 2012/13. The background of the "three order theory" has not changed. Yesterday's US cotton volume rose to a short-term boost to Zheng cotton in recent years. Investors could be short, but the role could not be sustained, and it could not change its long-term low position and stable operation.

[Wanda futures The market is worried about the damage to the quality of cotton and cotton, which has led to speculative buying and promoted cotton prices.

The market suspects that cotton picked earlier in the southeastern United States has a higher level of horse value, which may affect the use of textile enterprises. Speculative buying has been stimulated, and ICE cotton has got rid of the recent low lateral pattern. The main contract in December has gained 2.52 cents to 74.86 cents / pound, or 3.48%. Although the decline in quality will affect the use of textile enterprises, but at the end of the global inventory of up to 17 million 220 thousand tons, it is difficult to have a substantial impact on the market, and there is no possibility of revival of consumption, that is, the rebound in cotton prices can not change the long-term weakness, prudent view of the rebound is appropriate.

Tuesday ICE cotton continued to rise, the main force in December contracts stable above the short-term average, although the EMA system maintained a good drop in the alignment, but the short-term average line turned upwards, KD and MACD indicators in the vulnerable areas to form a multi gold fork arrangement, MACD index red column growth, rebound may continue, December contract is expected to challenge 77 cents / pound of the strong pressure level.

The low temperature in the southern region of Kashi leads to the difficulty of bolting the cotton bolls, which may lead to lower production than expected in Xinjiang. At the same time, the collection and storage progress is only a little slower than the progress of the public inspection. The above factors have suppressed the popularity of the short cut, so Zheng cotton has continued to rebound. However, the economic data released on Monday show that China's indicators continue to decline, and China has fallen into a recession. The inventory of enterprises will be the focus of operation. Meanwhile, the price of cotton will not increase and the demand for domestic cotton will be inhibited. Although the quality of cotton in some parts of the US cotton region may be damaged, it can not change the pattern of global oversupply. At the same time, new cotton is coming on the market in the northern hemisphere, China, India and the United States. Supply pressure is beginning to show, sales pressure is increasing and demand is hard to be stimulated. Cotton price rebound is difficult to change the long term weakness. 1301 if the contract breaks through the pressure level of 19700 yuan / tonne, the single stop will leave the field to wait and see, otherwise it will rely on 19700 yuan / ton to hold the empty list and short-term target to 19400 yuan / ton line.

[MEIKO futures] weakness in consumption is not the right time to catch up.

Overnight, Spain is considering boosting the market by applying for credit lines to the European Union. The US dollar has fallen sharply, and US stocks have also seen their biggest one-day gain since September 27th. Affected by this, ICE futures have attracted market buying, while high cotton micron values in the southeastern United States have led to investor concerns. A surge of buying has pushed the December contract to a high of 75.17 cents.

On the news side, China Tianhong Textile Group Limited plans to invest 70 million US dollars to invest in a cotton production enterprise in Bali, Hill, Western Turkey. The cotton production line will be put into operation in 1 years. After commissioning, Chinese textiles will be able to enter the European market directly through Turkey. From the above information, we can see that although China's policy of collecting and storing markets has stabilized the area of cotton planting, it has also weakened the competitiveness of the domestic textile industry. At present, the price difference between inside and outside the stock market is already close to 50 cents.

On the international market, on the 16 day, the price of China's main port of imported cotton continued to rise, of which 1 cents in the US cotton, Brazil cotton and India cotton, and 0.75 cents in West African cotton. At present, the number of downstream orders is insufficient, and the short list is the main reason. The rising price of cotton continues to inhibit the purchasing demand of textile mills. From the overall situation, the global consumer demand will be difficult to pick up because of the economic downturn. China's purchasing and storage will only play a supporting role in the market. {page_break}

Domestic market, 16, domestic cotton spot prices continue to maintain stable operation. At present, the purchase and storage will continue to provide support for cotton prices. Cotton prices will slowly move closer to the 20400 yuan / ton purchase and storage price under the influence of the purchase and storage policy, but before the domestic and foreign cotton demand has not changed well, the close distance does not mean that it can coincide.

On the 16 day, the central reserve store made 82910 tons of actual trade, with a turnover rate of 69.85%, of which the mainland planned to store and store 56700 tons, with a turnover rate of 21390 tons, with a turnover rate of 37.72%. Xinjiang plans to buy and store 62000 tons, with a turnover of 61520 tons, with a turnover rate of 99.23%. As of that day, the total turnover was 923960 tons, of which 184080 tons were traded in the mainland and 739880 tons in Xinjiang.

Spot quotation, October 16th, the US C/A cotton 88.10 (cents / pound), discount general trade port delivery price 15031 yuan / ton (calculated by sliding tax); Australia cotton 93.35, discount general trade port delivery price 15708 yuan / ton; Uzbekistan cotton 88.35, discount general trade port delivery price 15062 yuan / ton; West Africa cotton 84.60, discount general trade port delivery price 14601 yuan / ton; India cotton 85.35, discount general trade port delivery price 14692 yuan / ton. The national cotton price A index is 19644 yuan / ton; the B index is 18785 yuan, rising by 1 yuan.

Market analysis, the latest PMI indicators show that export orders are still in a state of atrophy, coupled with the macroeconomic situation has not changed significantly, textile enterprises may further reduce cotton consumption, the enthusiasm of purchasing raw materials will continue to be pressed. But in the wake of the purchase and storage, cotton prices have been supported in stages. Affected by the US dollar trend, ICE cotton rose sharply in the overnight period, but remained in the shock interval.

Operation is not suitable for catching up.

　 [one German futures] not to change the weakness of Zheng cotton

CF1301 opened higher on Tuesday, and CF1301 closed more than 6.4 million hands. CF1301 closed at 19540 yuan / ton, up 135 yuan / ton, reduced 10694 hand; in October 16th, China's imported cotton (FC Index M) 84.98 cents / pound, up 0.50 cents / pound, 1% yuan tariff reduced price 13755 yuan / ton, sliding price conversion price 14654 yuan / ton.

According to New York's October 16th news, the price of cotton during the ICE period rose nearly 4% on Tuesday, the biggest single day increase in more than two months. Traders worried about the quality of cotton in the short term. The ICE12 monthly settlement price was 74.86 cents per pound, up 3.5% on that day.

In October 16th, the cotton trading market in the national cotton trading market reached 12960 tons, an increase of 2480 tons over the previous transaction, an order reduction of 80 tons, and a total purchase of 86520 tons. On the 16 day, the opening price of each contract was high and low. On the basic level, the current volume of purchase and storage volume has increased, and the support for cotton prices has been strengthened. However, the order situation of textile enterprises is still not optimistic. clothing While the inventory remains high, textile demand is still showing no signs of improvement. Meanwhile, the price drop of cotton by-products has led to downward pressure on cotton prices, and cotton prices are expected to stabilize in the short term.

On Tuesday, Zheng cotton went up and down. The fundamentals did not change. Only due to the rise of the external market, the overnight single part reduction was observed. Today's disk reflects the stop loss of 19700. Generally speaking, the shock interval is hard to break, and the policy market exists for a long time. Today's operation suggests that overnight air bills can continue to hold, and the CF1301 reference price range is 19300-19700.