The Cotton Market Is In The Off-Season, And There Are Good And Bad In The Lint Market.

Recently, the spot price of domestic lint has been stable for a while. As of June 14th, the price of lint factory in Hebei and Shandong was 12100-12800 yuan / ton (3128C and 3128B), which was flat compared with last week.

The sale of reserve cotton is still hot. The textile market has entered the traditional off-season. I believe that the current market has both favorable factors supporting the spot market and the factors that restrict the rise in cotton prices.

At present, lint prices are temporarily rising. However, the high cost and limited supply of spot goods also support the difficult spot price of lint. It is expected that the spot price of lint will be stable and narrow in the near future.

The specific analysis is as follows:

Favorable factors supporting the spot market of lint:

Affected by the weather and the decline of the US dollar, the rainfall and flood in the southeastern part of the United States may affect crops. Last week, the US cotton harvest rose. As of June 9th, the US cotton December contract closed at 65.07 cents per pound, up 1.88 cents / pound compared with 63.19 cents a week in the same period last week. Zheng cotton also fell sharply. In June 13th, the CF1609 contract of zhengmian main contract closed at 13025 yuan / ton, up 245 yuan / ton, futures prices rebounded or added a favorable atmosphere to the lint spot market.

2. The shortage of lint is still strong.

The new year is expected to slump cotton planting, coupled with the current market price of seed cotton is still strong and running, cost increases, domestic mill processing profit is very thin, most manufacturers are still in shutdown state, manufacturers have relatively limited supply of goods, resulting in a low price of cotton ginning factory selling intention is not high, the mentality still exists, supporting the lint market.

Adverse factors restricting the spot market of lint cotton:

1, the textile market has entered the tradition.

At present, the textile and garment market will enter the traditional off-season, and the downstream orders have no substantial growth. The basic order is to take the goods in advance, and the spinning enterprises reduce the price of some yarns to promote sales. The flow spinning line has a larger decline, and some textile enterprises are pessimistic about the market outlook and have a strong wait-and-see mentality.

2, the cotton futures contract is hot and the market lint market is suppressed.

At present, the turnover of cotton reserves is still hot. As of June 14th, the cumulative output of reserve cotton in 2015/2016 was 788 thousand and 900 tons, with a turnover rate of 98.16%.

Among them, 492 thousand and 700 tons of domestic cotton were accumulated and 296 thousand and 100 tons of imported cotton were accumulated.

With the normalization of the turn out, more and more warehouses are coming out. Later, a large number of national stored cotton flows to the market, forming a pressure on the market lint price.