October 18, 2012 Institutional Watch - Cotton Futures

[Hongyuan futures] quality of US cotton is not enough to affect cotton prices in China.

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

Product: polyester staple fiber 10900 yuan / ton; viscose staple fiber 14890 yuan / ton; C32S price 25690 yuan / ton.

2. domestic stock: 17, the spot price of domestic cotton is still relatively stable.

Affected by the quality damage in the US cotton region, Zheng cotton futures rebounded sharply today, but this can not change the pattern of oversupply in the world, and the high price of domestic and foreign cotton is still high and the demand for domestic cotton is restrained.

3. imported cotton: in October 17th, the price of China's main port of imported cotton rose sharply, and all varieties increased by more than 1.5 cents. West Africa and India cotton quotes more than 2 cents.

4.ICE cotton: in October 17th, speculative buying once again entered the market. After the ICE futures pulled up rapidly, they were sealed down and trading volume continued to increase.

At present, the market is worried that the quality of the new cotton quality in the United States is too high, which can not generate warehouse receipts, and it is also difficult for textile mills to accept it.

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.

At present, the market is worried that the quality of the new cotton quality in the United States is too high, which can neither generate warehouse receipts nor be difficult for the textile mills to accept. However, under the background of weak cotton demand and large inventory in China, the quality problem of the US cotton is not enough to significantly affect the cotton price in China.

Although the US cotton volume has risen sharply, it has little effect on the promotion of Zheng cotton recently. Zheng cotton 1301 pays attention to the pressure of 19800 yuan / ton.

[MEIKO futures] price push cotton sales season cotton try upward

Overnight, speculative buying again flooded the market, ICE

After being pulled up rapidly, the trading volume was sealed and the volume continued to increase.

At present, the market is worried that the quality of the new cotton quality in the United States is too high, which can not generate warehouse receipts and is difficult for the textile mills to accept. Therefore, the short term resource supply problem of the United States cotton has surfaced and the bull market sentiment has been accumulated.

News: 1, the United States, large rainfall patronizing the central part of the United States and central and southern parts of the country, West Texas will be accompanied by Hailstorms and storms, local about half of the cotton has not been picked, it is estimated that about 5 million 470 thousand acres of cotton fields will be affected by the impact of this rainfall, will create a small amount of new cotton yield and quality damage.

2, the southern Xinjiang recently cooled and frosted, and light frost cotton and frost yellow cotton began to increase. Due to the fact that some cotton farmers and contractors did not pick their products second times, the quality and quality of seed cotton had been reduced by frost. Some of the non-agricultural loan enterprises have voluntarily reduced the seed cotton purchase price because of the reason that seed cotton purchase price is higher than expected (delivery and storage has no profit or even loss), and the capital flow is tight, so as to reduce the risk of storage and sale.

In the international market, in October 17th, the price of China's main port of imported cotton rose sharply, and all varieties increased by more than 1.5 cents. The price of cotton in West Africa and India exceeded 2 cents.

It is understood that as the domestic cotton prices are high and most of the high-quality cotton has entered the reserve bank, the textile factory has chosen the imported cotton with obvious price advantage.

Although there is a lack of quotas, the advantage of imported cotton still exists according to the tariff of 40%.

Therefore, a large number of cotton quilt textile factories have been ordered recently.

However, as cotton prices continue to rise in recent days, the price advantage has disappeared, so the risk of coming down is bigger and bigger.

Domestic market, 17, domestic cotton spot prices are still relatively stable.

Affected by the quality damage in the US cotton region, Zheng cotton futures rebounded sharply today, but this can not change the pattern of oversupply in the world, and the high price of domestic and foreign cotton is still high and the demand for domestic cotton is restrained.

As of October 17th, 2012 cotton temporary storage and storage pactions totaled 1002180 tons in October 17th, including 204900 tons in the mainland and 797280 tons in cotton.

Spot quotation, October 17th, the US C/A cotton 89.60 (cents / pound), discount general trade port delivery price 15220 yuan / ton (calculated by sliding tax); Australia cotton 95.85, discount general trade port delivery price 16044 yuan / ton; Uzbekistan cotton 89.85, discount general trade port delivery price 15252 yuan / ton; West Africa cotton 86.85, discount general trade port delivery price 14875 yuan / ton; India cotton 87.60, discount general trade port delivery price 14968 yuan / ton.

The national cotton price A index is 19644 yuan / ton; the B index is 18787 yuan, rising by 2 yuan.

Market analysis, the recent heavy rainfall in the United States has led to the damage of cotton yield and quality in the main cotton producing areas. In addition, the price of cotton inside and outside China is too large. China has been buying the United States and cotton to cause strong international cotton prices, but at the same time domestic cotton has been shelved by the market, but the pition period of the State Reserve purchase will also be stable.

Overnight, the market went straight to the 80 line. Zheng cotton was slightly weaker. However, the stability of the moving average system had a high pressure demand before the test.

Operation, backed by 19600 short line buying.

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[German futures] acquisition and storage pactions accelerated Zheng cotton upward test

Wednesday CF1301 high concussion, CF1301 closed more than 8.6 million hand trading, positions sharply reduced.

CF1301 closed at 19630 yuan / ton, up 130 yuan / ton, reduced 7478 hand; in October 17th, China's imported cotton (FC Index M) 86.08 cents / pound, up 1.10 cents / pound, 1% yuan tariff reduced price 13930 yuan / ton, sliding price conversion price 14786 yuan / ton.

According to New York's October 17th news, the price of cotton during the ICE period was closed on Wednesday, due to the poor quality of cotton delivered on the market, causing investors to worry about short-term supply.

The ICE12 cotton contract rose 4.01% and closed at 3 cents per day, closing at 77.86 cents a pound.

In October 17th, the cotton trading market in the national cotton trading market reached 12900 tons, a decrease of 60 tons compared with the previous trading day, an increase of 1320 tons of orders, and a total purchase of 87840 tons.

On the 17 day, the opening price of each contract was high and low.

On the basic side, according to the China Cotton store news, up to now, the China Cotton Storage General Corporation has signed a large single contract with the China Cotton Group Co., Ltd. and Xinjiang production and construction corps cotton and hemp company. The initial intention is 300 thousand tons and 600 thousand tons respectively.

It shows that the intensity of State purchasing and storage is further strengthened, which partly offset the downward pressure of cotton prices due to the large quantity of new cotton market, and strengthened the support for cotton prices.

Zheng cotton on Wednesday high shock, for 2 consecutive days, the United States cotton rose more than 7%, affected by Zheng cotton attack on the track, as of 17 days, the state

The volume has reached 1 million tons, the bottom effect has appeared, and the empty one has temporarily left the field.

Today's operation recommends that overnight single stop stop departure, CF1301 reference price range is 19400-19800.