Strong Willingness To Carry Prices Within The Territory

According to some cotton processing enterprises and regulatory warehouses in Bachu, Akesu and other places, since the late November, the railway stations in the southern Xinjiang have been pressed out of the Yangtze River, and some of the hot spot flows (such as Shanghai, Wuhan and Zhengzhou) have not been realized for a variety of reasons. The contradiction between the large quantity of imported lint and the limited capacity of the cotton railway is outstanding.

Recently, despite the widespread atmosphere of "selling hard cotton" in the mainland, the procurement of raw materials from cotton enterprises is also not positive, but the cost of lint cotton is high, the price of the corps cotton is higher than the current market price of 300-400 yuan / ton, and domestic textile enterprises are still in the market.

Low inventory and high quality cotton in 2015/16

Relatively large expected support.

In December 6th, Jiangsu, Zhejiang and other places warehouse 3128B/3127C grade Southern Xinjiang hand picked cotton inspection gross weight pick up goods quoted price respectively is 13200-13300 yuan / ton, 12800-12900 yuan / ton, but Kuitun, Sha Wan and so on origin 3128B/3128A class each ton quoted price is higher than its 100-200 yuan.

A cotton trader in Yancheng said that cotton producers and middlemen in Jiangsu, Zhejiang and Shandong this year generally believed that the quality of cotton in southern Xinjiang was not as good as that in the North Xinjiang, and that they were the biggest "short boards" in terms of horse value and short fiber length.

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Business enterprises, cotton enterprises and a few cotton textile mills still choose to go out of Xinjiang in order to meet the production needs in time. On the one hand, most cotton in Xinjiang has entered the regulatory library, and the demand for vehicles has gradually declined. The number of vehicles coming out of Xinjiang has increased, the freight rate has been loosened in 10 and November. On the other hand, the price of domestic gasoline has been continuously lowered, and the cost of cotton driving has been reduced. The cotton operators and textile enterprises in Henan, Hebei, Shandong and other places indicate that the cost to be deducted from the territory's freight forwarding and the pfer to the inland Treasury is only 100 yuan / ton higher than that of the railway freight.

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At present, cotton production is decreasing obviously, and supply and demand are basically balanced.

According to the USDA report, China's cotton output in is 6 million 530 thousand tons, consumption is 7 million 190 thousand tons, import volume is 1 million 400 thousand tons, and annual turnover is about 700 thousand tons.

This year, the market is widely expected to have about 4 million 800 thousand tons of cotton output in 2015/2016, including 3 million 600 thousand tons in Xinjiang and 1 million 200 thousand tons in the mainland.

This year, the market expects that the average cotton consumption per month is only about 525 thousand tons. The annual cotton consumption is only 6 million 300 thousand tons, plus 894 thousand tons of imported cotton. This year basically reached the balance of supply and demand.

However, new flower sales are more than half, low grade flowers are unsalable.

This year, the sale of spot terminals is obviously similar to that of last year. Textile enterprises mainly seek high-grade cotton in the spot market, and the sales of low grade cotton are very unsatisfactory. This is already evident in this year when the new cotton seeds come into the market.

In the early years of seed cotton listing last year, many spot traders and ginning plants rushed to the Xinjiang plant to seize cotton and a large number of lint piled up in the intermediate links.

In the subsequent supply season, but the demand is not up to the case, many companies choose to wait for the stock market, wait and see the market practice, and finally a large number of low-grade cotton left in their hands, there have been varying degrees of loss.

Only by adopting the principle of "fast forward and quick exit" can enterprises barely defend their profits.

In 2015, the trend of cotton prices fell, creating a new low for many years. The 2015/2016 cotton production in the year has not brought a marked turn to the cotton market.

As the end of the year draws near, the market's negative factors are concentrated. Zheng cotton may again usher in a downward trend.

This year, the middlemen who experienced last year's situation were very cautious from the acquisition of seed cotton, not only to catch the quality of new flowers, but also to pay much attention to purchasing prices to control costs, and more enterprises choose to pay attention to hedging opportunities in the difficult situation of spot sales.

In the case of the same spot last year, the best way for spot enterprises to cash the remaining cotton is to make warehouse receipts. The price discovery function of the futures market will guide these cotton to a reasonable price range.

In terms of demand, the textile industry is depressed because of the macroeconomic constraints.

Over the past two years, the domestic textile industry has seen a sharp decline.

China's huge economic growth cycle has pushed the cost of domestic manufacturing continuously higher. The high cost of raw materials and high wage cost make domestic manufacturing industry no longer competitive in the international market.

On the contrary, production advantages of some emerging Southeast Asian countries such as India and Vietnam are beginning to emerge.

At the same time, the macroeconomic downturn has caused a series of impacts such as the low domestic consumption demand and the tight cash flow of enterprises.

In addition, the market is expected to move closer to the market.

The price of dumping will largely determine the ceiling of cotton prices next year.

Moreover, after the result of the dumping and storage paction in July, the state's accelerated digestion of cotton reserves is likely to be a big probability event.

Recently, the market began to send news about dumping and storage. The market has speculated about the time of throwing and storing and the price of throwing and storing. As long as the state gives clear signals of dumping and storage, the market will give a reasonable price.

Looking ahead, cotton futures prices will eventually return.

At present, Xinjiang 3128B class cotton picking spot price is about 12400 yuan / ton, as the disk represents more low-grade cotton prices, the current 1601 contract price discount spot 300 yuan / ton is a reasonable interval.

Taking into account the pressure on the far price of the month and the pressure on the upper cover, the bull market is a small probability event, and the 1601 contract is more likely to shock around the 12000 point before maturity.

At present, the 1605 contract discount spot is 900 yuan / ton, the base is bigger, and the spot price trend later may continue to be weak.

From the perspective of capital, the advantage of short capital is very obvious. The probability of continued downward pressure on capital in the long run is very large.

However, taking into account the seasonal factors of cotton, we should pay attention to the risk of return to base.