Before The Spring Festival, Zheng Cotton Is Weak Or Temporarily Fluctuated.

Recently, the trend of Zheng cotton was somewhat tangled. The upward trend was obviously weak, and the trend was also somewhat deviated from other commodities. When we thought that a narrow fluctuation continued before the festival, it was a little bit off today, and the CF1905 contract fell 105 points to 15055 yuan / ton. If this development is going to break through the 15000 yuan / ton point, we can only see whether 14650 can support it. If we support it, we will still be at the bottom of the market. Otherwise, the lower lows will really not predict well, which is likely to exceed market expectations.

According to the USDA12 month forecast, the world's output is less than 1 million 500 thousand tons, and China's output is more than 1 million 657 thousand tons. China's output is less than 3 million 157 thousand tons, and the global production and sales inventory ratio has dropped to 58.3%. In spite of the above data, I believe that although the cotton production and demand in China and the global market are in a tight state, if the global economy continues to decline in the future, cotton consumption is bound to decline, so the above data need to be interpreted from a different angle. In January, the national cotton market monitoring system released the monthly forecast of China's production and demand, indicating that domestic cotton consumption is 8 million 63 thousand tons. For China, especially in the uncertain situation of Sino US relations, it is also doubtful whether the cotton consumption can be maintained at more than 8 million tons.

Investors who believe that the fundamentals are more profitable should be careful. For example, in the January monthly report, we also mentioned the situation of cotton planting in 2019. I think this is also very important for cotton price trend in the future. According to the monthly report, the National Bureau of statistics will substantially increase the output of cotton in Xinjiang or increase the subsidy quota of Xinjiang's target price in 2019, which has already been reflected in the pre allocated subsidy that has been issued this year. In addition, Xinjiang's cotton target price policy is facing adjustment after 2019. In view of the above two factors, the cotton planting area in Xinjiang in 2019 is expected to increase substantially compared with 2018. If the facts are indeed predicted, cotton prices may continue to be under pressure in 2019. Therefore, at the present stage, we must not simply build up the bottom, otherwise we will be hard hit by the market again and again. No one can give an accurate answer to the question of how cotton prices will go in the future.