Cotton Prices Can Not Rise, Let Us Cotton Into Crisis

According to the analysis report of the National Cotton Association (NCC), the digestion of American cotton is still mainly dependent on exports. Since the beginning of this year, the export of US cotton to China has dropped by 80% compared with the same period last year. The recent US cotton shipment has always been difficult to increase. It is still very difficult to complete the target of USDA (2 million 68 thousand tons).

NCC said that although China has been in the country for nearly a year

It has fallen sharply, but is still nearly twice as high as chemical fiber. It is still very difficult for Chinese enterprises to increase the ratio of cotton to cotton.

Although global cotton consumption exceeded output this year, the end of the year

There has been a decline, but the stock has not declined significantly, and the decline in inventory is mainly due to China's digestion of reserve cotton. If China throws large quantities of reserves, the negative impact on the international cotton price is self-evident, especially the sufficient supply of reserve cotton will reduce the demand for imported yarn in China.

In addition, as an important market for us cotton exports, Turkey continues to carry out anti-dumping investigations against US cotton, which may lead to higher tariffs for us cotton exports to the country, while other varieties will be exported to Turkey.

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In addition, cotton consumption in the US has increased slightly in recent years, but the strength of the US dollar will also inhibit the export of American cotton yarn.

The demand for cotton is low, imports from China are reduced, prices of agricultural products are low, and the strength of the US dollar has become the current cotton price.

According to the statistics of the US Department of agriculture, as of February 25th, the total net export volume of cotton in the US 2015/16 reached 1 million 578 thousand tons, down 603 thousand tons compared with the same period last year, and completed the USDA forecast of 75%, down from 88% in the same period last year.

The shipment volume of US cotton was 876 thousand tons, down 193 thousand tons compared with the same period, and finished 42% of USDA forecast, lower than 43% of the same period last year.

To complete the export target of USDA, the average weekly shipment volume and contract volume of US cotton weekly need to reach 55 thousand and 100 tons and 23 thousand and 200 tons respectively.