Most Investors Are Waiting For The Stock To Be Reduced.

Zheng cotton's main contract fell from 16000 yuan / ton above to 15500 yuan / ton support position, has been around the spot narrow fluctuations.

However, last Friday, Zheng cotton prices climbed sharply, and the main contract rose by 420 yuan / ton, which is beyond many people's expectations.

Combined with the domestic and foreign cotton spot market and domestic market situation, I believe that the domestic cotton market in the medium and long term is too large, and it is not suitable to catch up before dumping.

Due to the unexpected cotton production in Xinjiang, the US agricultural report raised the cotton output in February to 109 thousand tons, to 4 million 898 thousand tons, while maintaining the consumption of 7 million 892 thousand tons.

Despite the increase in domestic cotton production, the supply gap in the year is still as high as 3 million tons, an increase of 170 thousand tons over the previous year, which is the largest supply gap since the implementation of the temporary storage policy in 2011/12.

According to the relevant institutions in China

Inventory statistics, 3 years of temporary storage, plus the former Chen cotton, accumulated 17 million 300 thousand tons of cotton, while 2012-2016 years of total cotton production of 9 million 630 thousand tons.

In 2014 and 2016, the turnover volume was larger, with a total of 2 million 396 thousand tons and 2 million 670 thousand tons respectively, with a turnover ratio of 19% and 89% respectively.

The year 2016 is the highest proportion of dumping and storage pactions. The main reasons are as follows: reserve cotton is sold for "batch inspection" and "package inspection". The quality is guaranteed and the worries of enterprises are solved. There is a shortage of circulating resources in the market, and reserve cotton is the main source of market supply.

According to insiders, the sale of reserve cotton is expected this year.

There is still protection and will be 2 months ahead of schedule last year, and the market supply will be significantly improved compared with the beginning of last year.

However, after 5 years of dumping and storage, only 7 million 670 thousand tons of cotton remaining in the State Reserve will be reduced to 5 million tons (excluding the new annual round of imports) after dumping this year.

In addition, compared to other crops, cotton planting income ratio is not prominent, cotton planting area has declined for 5 consecutive years.

Cotton planting area decreased by 43% in 2007 compared with that of last year.

According to the investigation of the Xinjiang autonomous region development and Reform Commission, the planting area of cotton per household this year is expected to decrease by 2.81% compared with the actual sowing surface last year.

After the reserve cotton inventory has dropped to 5 million tons, the decline of cotton planting area will benefit domestic cotton prices for a long time.

As of February 16th, the total sales volume of the US cotton contract has approached 90% of the estimated volume of the US agricultural report. The main buyers are China, Vietnam, Bangladesh, India and Pakistan.

With the reduction of US cotton exports, international buyers will re find the right source of supply.

As of last week, the new cotton market in India exceeded 3 million tons, and the listing rate accelerated to 60%.

However, because of high domestic cotton prices, India imported cotton and cotton yarn in large quantities.

Even if the supply is heavy, there is no sign that India's cotton prices are showing signs of decline.

India cotton farmers generally reluctant to sell, S-6 quoted 42600 rupees / candi, a slight decrease of 200 rupee / candi compared to the middle of the month, up 700 rupee / candi compared with the beginning of the month.

According to the formula for calculating reserve price of reserve cotton, the price is about 1520 yuan / ton, down 200 yuan / ton compared with last week.

In addition, from the disk, the main contract point is now close to the oscillation interval in early February, and from last Friday's premium to the current level of water.

There are only 5 trading days from March 6th. Although the price of cotton is good in the medium and long term, it is not easy to see too much inflation in the short term.

For more information, please pay attention to the world clothing shoes and hats net report.