The Cold Policy Of Cotton Market Will Dominate The Market Direction.

Judging from cotton consumption in recent years, March should be downstream textiles after the Spring Festival. industry Purchasing gradually increasing nodes should have a great boost to cotton prices. However, after the Spring Festival this year, cotton spot purchases showed a relatively cool situation, cotton futures also experienced several days of oscillation, and there was a continuous downward trend (since March, the 1509 contract of zhengmian main force has dropped to 700 points). The reason is that the supply of cotton is relatively abundant, and the downstream purchasing is not flourishing. The direction of policy also affects the further direction of cotton market.

Xinjiang corps cotton sales pressure is huge

It is understood that the Xinjiang cotton Corps processed more than 1 million 600 thousand tons of new cotton in 2014. On the eve of the Spring Festival, the Xinjiang Corps official said that the sale of cotton in the first quarter was more than half. However, as of the beginning of March, the sales rate of the Xinjiang regiment was only 1/4, which was a sharp increase in cotton sales pressure.

Under heavy pressure, Xinjiang Corps's cotton sales. strategy In March 3rd, the Xinjiang regiment reduced the minimum selling price of cotton, and there would be a certain price discount for the purchase of large orders. As soon as the news came out, Zheng cotton futures fell, and prices continued to fall. There is no doubt that the sudden drop in price of the Xinjiang regiment is a heavy blow to the domestic cotton market, and the cotton price in Xinjiang will also decline in a certain range. Because Xinjiang's cotton output accounts for more than 2/3 of the total cotton output in China, and there are not many cotton in the mainland, so the price of Xinjiang cotton directly determines the price trend of domestic cotton market.

As a result, the lowest sales price of machine picked cotton in Xinjiang Corps was 13500 yuan / ton before, which formed a high price support for domestic cotton. "The price of the corps" is also a confidence expression for the market. Once the sale is announced, it will cause a chain reaction. Especially when the downstream consumption is not strong, it is more likely that the cotton will become cheaper and cheaper. Therefore, within a certain period of time, domestic cotton prices will move downward and may find a new balance.

After the Spring Festival, the purchasing season is not prosperous.

Because the textile enterprises have a certain amount of raw material inventory before the Spring Festival, they usually support a period of time after the Spring Festival. This year's downstream factories are much later than before. Many factories start off after the Lantern Festival.

The author visited Binzhou, Dezhou and other textile enterprises to understand that after the Spring Festival, the procurement started slowly, and the orders were mainly small ones. There was no purchase of large orders. The shortage of downstream orders also directly affects the enthusiasm of textile enterprises to purchase cotton. It is understood that although many cotton merchants have the idea of raising prices after the Spring Festival, they have no choice but to face the situation that there is no market price. The cotton price reduction of the Xinjiang regiment is adding insult to injury to the cotton market. Comparatively speaking, the spot price of cotton in the mainland is more stable, and the price of cotton in Xinjiang is different.

Policy adjustment is the focus of attention in the post market period

In order to improve the supply and demand pattern of the domestic cotton market and maintain the smooth operation of cotton prices, the five ministries and commissions of the Xinjiang development and Reform Commission and the finance department jointly issued the notice on conscientiously doing the work of reducing the planting area in Xinjiang recently (hereinafter referred to as the notice). The notice reduced the cotton production forecast in the new year to some extent, and clearly pointed out that the target price of direct subsidy in the new year will be lower than that of last year. Cotton farmers should be guided to see the cotton market situation, reduce cotton planting and transform other crops. From this point of view, the decline in planting area of Xinjiang cotton in 2015 may be inevitable.

In addition, due to the loss of support and storage of cotton in the mainland this year, sales prices declined sharply compared with last year. Cotton growers' enthusiasm for planting has declined significantly. Data are expected to reduce cotton planting area by more than 1/3 in the mainland. The support of direct subsidy policy will directly affect cotton growers' planting intention and new cotton output. At present, the market generally believes that there are more than 10 million tons of cotton in the national reservoir, which may be more than a year and a half of cotton consumption in the country. Therefore, after March, is the state taking the reservoir? market Focus of attention.

The author thinks that the selling of cotton reserves needs to meet the situation that domestic cotton is in short supply. Therefore, we should look at the progress of domestic cotton consumption if we throw or not throw it. The shortage of supply will inevitably cause cotton prices to rise. If we maintain the current weak pattern, reserve cotton should wait quietly, but if there is an accident, it will be another matter.

To sum up, at present, cotton purchasing is not active, and downstream consumption warming is still to be observed. As the supply surplus situation still exists, cotton prices do not have room for substantial growth. Similarly, due to the domestic cotton cost support and continuous consumption, the cotton price of Xinjiang cotton has maintained a general trend of oscillation in the case of no reduction in cotton prices and no significant decline in cotton prices in the mainland.