The Impact Of Sino US Trade Negotiations On Cotton Prices Is Weakening.

Since last year's trade friction between China and the United States began, 7 rounds of talks have been held. The news of the talks between the two sides has directly affected the trend of cotton prices both at home and abroad.

Once the talks appear to be good news, cotton prices will rebound sharply, otherwise they will return to the downward trend of turbulence.

Is the result of Sino US trade talks so important?

According to China cotton net reporter analysis, Sino US trade negotiations have an important impact on cotton price trend. First, the United States is China's largest textile and clothing export place; two, the development of the cotton textile industry is inseparable from the improvement of the macro environment. If the negotiations between the two sides fail to achieve positive results, the market will surely cause the market to have some concerns about the future economic development prospects of China.

Of course, we should not attach too much importance to the impact of Sino US trade negotiations on cotton prices, and whether the balance of supply and demand of cotton is also important.

Some professionals believe that at this stage, the impact of Sino US trade negotiations on cotton prices should not be overemphasized. The success of the talks is related to whether the demand for cotton can be stabilized, rather than whether it can be increased.

With the increase of production cost, the cost advantage of China's cotton and garment industry is gradually shrinking, and the share of the world garment market is also shrinking, and it is already irreversible trend.

From this point of view, cotton consumption in the future should be stable at most. It is not realistic to hope for a substantial increase in consumption.

If the downstream is stable, pushing upstream supply and demand side, as long as the increase in output is not conducive to the rise in cotton prices, especially in the short term, the price of cotton will be difficult to rise.

Just as a former expert said, what kind of policy will result in institutional economics inevitably? Cotton Subsidy Policy may not necessarily lead to an increase in cotton planting area in Xinjiang, but at least stability is no problem.

Of course, some people have said that after the Sino US talks have seen many rounds of seesaw warfare, the market has gradually weakened its response, and it is expected that there will be no big accidents as a result of good results, which may guide the funds to gradually seek new hype points.

Following the trend of Zheng cotton and Sino US negotiation nodes, Zheng cotton's fluctuations were closely related to the results of the talks, but they were closely related. But judging from the recent trend, the trend of the two sides deviated somewhat and gradually returned to the fundamentals.

The reporter has consulted the downstream export data of textile and clothing in recent years, and shows that China's export share is also declining.

Since it is based on annual statistics, export figures for the second half of 2018 are not yet available. It can be seen from the figure that the year 2018 remains stable, but the data are not beautiful from the second half.