Global Cotton Production And Inventory Increase, India Cotton Prices Rise

In January 2017, USDA announced the change of the 2016/17 balance table: cotton production increased by 218 thousand tons to 4 million 790 thousand tons, cotton production increased by 94 thousand tons to 3 million 692 thousand tons, cotton production in Pakistan dropped 76 thousand tons to 1 million 720 thousand tons, and global cotton production increased 240 thousand tons to 22 million 935 thousand tons.

China's cotton production has been raised by 109 thousand tons to 7 million 893 thousand tons, and the cotton consumption in India has been reduced by 109 thousand tons to 5 million 62 thousand tons, and the global cotton consumption has been reduced by 34 thousand tons to 24 million 333 thousand tons.

Cotton imports in Pakistan increased by 76 thousand tons to 555 thousand tons.

US cotton exports increased 66 thousand tons to 2 million 722 thousand tons, India

Cotton volume was raised from 44 thousand tons to 958 thousand tons.

China's cotton stocks have been raised by 109 thousand tons to 10 million 527 thousand tons. Cotton stocks in India have been raised by 65 thousand tons to 2 million 633 thousand tons. Cotton stocks in the United States have increased by 44 thousand tons to 1 million 89 thousand tons, Australian cotton stocks have increased 54 thousand tons to 500 thousand tons, and global stocks have increased by 327 thousand tons to 19 million 737 thousand tons.

In the year of 2016/17, the output of US cotton increased greatly, and the total output increased by nearly 900 thousand tons compared with 2015/16. And because of the good weather this year, the quality of American cotton is better.

Thanks to the increase in cotton prices in India this year, the United States cotton increased production this year, but the sales situation is very good. The textile mills all recognize the cost performance of the United States and cotton, so the US cotton futures industry is relatively strong.

In addition, this year China's signing of the US cotton market has increased a lot more than that of last year. After buying a lot of US cotton, China's large buyer played a very important role in supporting the US cotton market.

The latest US cotton sales situation, as of the week January 12th, the United States signed a total of 2 million 32 thousand tons of Upland Cotton in 2016/17, an increase of 65.3% over the same period last year, with a contract progress of 78%, an average of 5 years, 79%, a total shipment of 952 thousand tons of upland cotton, a shipment of 36%, and an average of 5 years 30%.

It is noteworthy that China signed this year.

As compared with last year, as of January 12th, China signed a total of 310 thousand tons of cotton and 15.3% of the total contracted volume. The shipment volume of US cotton is 149 thousand tons, which accounts for 15.7% of the total shipment volume. Therefore, from this point of view, the quantity of cotton purchased in the United States has increased significantly over the past year.

However, due to the limited number of quotas in China, only 894 thousand tons, if only half a year, China's contracted cotton volume will reach about 300000 tons. In the whole year, the contracted volume will reach 50-60 million tons, which is unlikely to be achieved in the case of relatively tight quotas. Therefore, we dare to predict what other quotas will be issued in addition to the quotas this year.

Because

The new currency policy has made India's new flower listing slow this year. In the past year, the number of listed listings remained at about 25 thousand tons, but in December there was a large number of orders for exports to China and Pakistan, which resulted in the high price of cotton in India.

According to the statistics of CCI, the total amount of new flower in India was up to 2 million 180 thousand tons by the end of January 19th. According to the data of India Cotton Association (CAI), the output of cotton in India reached nearly 5 million 800 thousand tons in 2016/17, that is to say, in the next time, India new cotton still needs about 3600000 tons to go to the market.

Previously, we anticipate that due to the low volume of new flower listing in the early stage of India, the pressure of new flower listing will be large in the late stage. But up to now, the amount of new flower listing in India has remained at about 25 thousand tons, and the total listing volume has reached 2 million 180 thousand tons, and the India cotton farmers' mentality of selling is still in store. The pressure of the cotton mill is still not very high in the future. We expect that the new flower of India will maintain a relatively stable rhythm, which means that the new flower price of India is not strong enough to go down later, but it may maintain a relatively strong state.

Up to now, the price of India S-6 ginning factory has been quoted at 79.4 cents / pound.

Due to the high price of cotton in India and the relatively low price difference between China and India, the cost advantage of India's cotton yarn re exported to China will gradually disappear, and many India cotton yarn will be difficult to enter the Chinese market, and the consumption of cotton in India will also be reduced.

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