Cotton Market Weekly: Domestic And Foreign Markets Will Be Attributed To "Calm".

Domestic cotton prices are mainly oscillating in the short term.

Short term supply shortage in the domestic market has not been effectively alleviated, and the difference between domestic and foreign cotton prices has been at a relatively high level. It is expected that domestic cotton prices will be dominated by oscillating trend in the short term.

International cotton prices will continue to consolidate.

This week, domestic cotton spot prices rose steadily, futures prices fell, cotton yarn prices continued to rise, and international cotton prices fell.

This week, domestic cotton spot prices rose steadily, and futures prices fell slightly.

In November 25th, the average selling price of the standard grade lint in the mainland was 15850 yuan / ton, up 166 yuan / ton compared with last week, or 1.06%, up 2967 yuan / ton compared with last week, or 23%.

The national cotton trading market electronic matching pactions in December the average contract price of 14808 yuan / ton, compared with last week fell 170 yuan / ton, a decline of 1.13%, up 2870 yuan / ton, or 24%.

Zhengzhou cotton futures CF1701 contract settlement price of 15780 yuan / ton, down 165 yuan / ton compared with last week, a decrease of 1.03%, up 3580 yuan / ton, or 29.3%.

The average purchase price of domestic grade 3 seed cotton is 3.64 yuan / kg (folding cotton lint 14359 yuan / ton), up 0.01 yuan / Jin, or 0.28%, up 0.88 yuan / Jin, or 31.88%.

The average price of cotton seed purchase in the mainland is 3.7 yuan / kg (14463 yuan / ton), which is flat compared with last week, up 0.71 yuan / Jin, or 23.75%; the average price of seed cotton purchase in Xinjiang is 3.6 yuan / jin (14313 yuan / ton), which is flat compared with last week, up 0.94 yuan / Jin, or 35.34%.

This week, domestic cotton yarn prices continued to rise slightly, polyester and short prices rose slightly.

In November 25th, the price of 32 cotton combed yarn was 23175 yuan / ton, up 195 yuan / ton, or 0.85%, compared with last week, and the price of polyester staple fiber was 7325 yuan / ton, up 15 yuan / ton last week, or 0.21%.

International cotton prices fell this week.

In November 25th, New York cotton futures contract settlement price in December was 72.65 cents / pound, down 0.75 cents / pound, or 1.02%, compared with last week.

The international cotton index (M), which represents the average price of the Chinese main port on the import cotton, is calculated at 1% tariffs. The import cost of the folded RMB is 14230 yuan / ton, down 127 yuan / ton compared with last week, or 0.88%, lower than the domestic market 1620 yuan / ton, and the price difference narrowed 606 yuan / ton last week.

On the macro level, according to the latest statistics of the National Bureau of statistics, 1-10 months, the total profit of Industrial Enterprises above Designated Size reached 5 trillion and 256 billion 770 million yuan, an increase of 8.6% over the same period last year, and the growth rate was 0.2 percentage points faster than that in 1-9 months.

According to the General Administration of customs, China imported 41 thousand and 300 tons of cotton in October 2016, down 1.84% from the same period last year, and imported 140 thousand and 700 tons of cotton yarn in October, down 19.25% from the same period last year.

This week, the central bank increased funds to achieve net investment of RMB 40 billion yuan.

Sustained low innovation.

In terms of fundamentals, as cotton picking is coming to an end, the focus of cotton enterprises' attention is shifted from seed cotton purchase to lint processing, sales and moving cotton warehouse.

As of November 25th, the total number of processing lint 3 million 220 thousand tons in the whole country decreased by 66 thousand tons compared with that of the previous year, and the total sales of lint 942 thousand tons, down 243 thousand tons compared with the same period last year.

Because the quality of seed cotton decreased later.

The cost is still on the high side. The Xinjiang double 29 hand picking cotton warehouse has a price of 16000 yuan / ton, and the cost of pportation to the mainland is 16400-16500 yuan / ton (500 yuan / ton pport subsidy), and the 3128 level cotton export price of the mainland is 15500-15600 yuan / ton.

Recently, the pport capacity of Xinjiang cotton was slowly recovered, and some new cotton enterprises began to actively move to the mainland.

In November 22nd, two ministries and commissions issued a notice on the issuance of the national cotton store.

In terms of technology, Zhengzhou cotton main contract (CF1705) rose this week and then fell back. Recently, attention has been paid to the support of the 20 day moving average, which will be adjusted in the short term or at the end of.

On the macro side, the US data continued to perform well this week. The United States applied for unemployment benefits for the first time in November 19th, 251 thousand, an increase of 18 thousand over last week, but it remained 90 weeks below the 300 thousand pass in the 90 week. The US consumer confidence index of University of Michigan in November ended at 93.8, the highest since May, better than expected.

The majority of participants at the Fed's FOMC11 month monetary policy conference said that "relatively rapid" interest rate increase may be very appropriate, suggesting that the December rate hike is a foregone conclusion.

The euro zone's manufacturing PMI in November was 53.7, an increase of 0.2 points, the highest in 34 months.

In terms of fundamentals, according to the US Department of agriculture report, on November 11-17, the net contract volume of US cotton exports in 2016/17 was 57 thousand and 800 tons, up 19% from the previous week, an increase of 52% over the previous four weeks average.

As of November 15th, the processing volume of new cotton in the United States totaled 1 million 720 thousand tons, up 32% from the same period last year, which is higher than that of 1 million 709 thousand tons and 1 million 298 thousand tons in the same period of 2014/15 and 2013/14.

This week, the average price of M spot in the seven largest markets in the United States was 74.83 cents / pound, up 0.47 cents / pound from the previous week.

This week, the supply of India ginning factory increased, cotton prices began to fall, and cotton yarn prices dropped. On the 25 th, the price of S-6 cotton in India was 72.92 cents / pound (1% yuan in tariff, 12645 yuan / ton in import cost), which was 2.15 cents lower than last week, or 2.86%.

The Pakistan government has stopped importing India cotton's new customs import license. The price of cotton in Pakistan has dropped slightly. On the 24 day, the price of domestic cotton in Pakistan was 72.04 cents / pound (the cost of imports was calculated at 1% yuan, the cost of imports was 12497 yuan / ton), which was 1.02 cents lower than last week, or 1.44%.

Technical aspect, this week ICE cotton futures main contract (March contract) has dropped, attention should be paid to the 20 day moving average support strength, or will maintain consolidation in the short term.

In conclusion, international cotton prices are expected to be consolidated in the short term.