New York Cotton Market May Have Deep Callbacks

New York Stage cotton Zhou entered the lowlands, but the decline was small. US cotton futures hit a month low on Monday. The market was further pressurized by the bad demand and supply report released last week by the Ministry of agriculture. Dealers said before that the market could have a deep callback.

The most active ICE-7 month contract fell to a low of 90.50 cents in April 11th and rebounded, dropping 1.06 cents, or 1.1%, at 91.30 cents a pound.

The contract has fallen by nearly 2% in the past two trading days, due to a preliminary estimate of cotton production released by the US Department of agriculture in 2014/15.

"The market is on sale after Friday's announcement of supply and demand report," said Citigroup's futures expert Sterling Smith.

The Ministry of agriculture is cautiously predicting that the world's largest Spin China's imports of cotton will be reduced by 1/3 in 2014-15 years, thanks to the government's policy of reform and storage.

The Ministry of agriculture also predicts that the end of the US cotton inventory will increase to 3 million 900 thousand packages (480 pounds per pack), and the current crop year is 2 million 800 thousand packs, which is in line with market expectations.

The Ministry of agriculture's forecast of global production is even more pessimistic. It is estimated that the global cotton carry over inventory will be 101 million packs and 2013-14 in 97 million 910 thousand, which will refresh the output record for fourth consecutive years.

On Monday transaction In China, cotton contracts for ICE-12 months fell, but not much, only 0.4 cents. The contract will include the new crop that was estimated by the Ministry of agriculture in 2014-2015.