There Is Little Change In Cotton Fundamentals. Zheng Cotton Oscillation Market Is Maintained Until April.

Zheng cotton oscillation market will continue for 2-4 weeks until spring sowing in April.

The oscillation interval is between 15000-15600 yuan / ton, and the operation can be high and low.

In September 28, 2018, Zhengshang suspended the business of warehousing delivery of Nong Jiale cotton in Northern Xinjiang, and set up Xinjiang agricultural materials and Kuitun storage and pportation company of Xinjiang production and Construction Corps as designated cotton delivery warehouses.

According to statistics, in the 17002 warehouse receipts registered by Zheng Shang, five registered warehouses in Xinjiang (Korla Silver Star, Shihezi Tian Yin, Xinjiang agricultural group, Xinjiang silver cotton and Xinjiang new building) registered 13392 volumes, accounting for 78.8%, of which 9739 were new Xinjiang agricultural group, silver cotton and new warehouse receipts.

There are two ways to digest warehouse receipts: one is shift storage digestion, the two is futures prices falling, and the decline is larger than the spot price fall, making downstream textile enterprises willing to accept warehouse receipts.

For Chen cotton warehouse list (the remaining 1283 of Chen cotton warehouse list), it is obviously not feasible to move through warehouse to digest warehouse receipts.

At present, constrained by the low purchasing power, spot prices remain relatively stable, so the warehouse receipts can only be gradually digested through futures declines.

At present, it is difficult to digest all the 58 outflow of current daily outflow before the due date, so cotton prices in March are still falling slightly.

As at 24 o'clock in March 14, 2019, a total of 968 cotton processing enterprises in the 2018 cotton year were notarized, with a total inspection volume of 5 million 220 thousand tons, of which 4 million 930 thousand tons in Xinjiang and 290 thousand tons in the mainland.

The price of lint in Xinjiang is more than 15800-16000 yuan / ton, and the price of lint in the mainland is 15000-15500 yuan / ton.

Since late October last year, the price of futures has always been oscillating in the range of 15000-15600 yuan / ton.

During the replenishment period from December 26th to January 21st this year, the position increased by 92 thousand, and the price increased by 610 yuan / ton.

In January 17th, the price of zhengmian main contract fell to 14650 yuan / ton, then rose to 15380 yuan / ton, but it still did not reach the expected level of protection in Northern Xinjiang.

Observing the disk, it is found that the probability of hedging in the ginning factory is very small.

At the same time, Zheng cotton futures price fell to 14950 yuan / ton, but there was not much change in position, and the willingness to accept the goods at lower price point was not strong enough, and the pressure on the bull market was still great.

On February 18-22, Zheng cotton launched a rally, the highest price of 15610 yuan / ton, increased 201 thousand positions, but then reduced the volume, the price fell sharply.

In the short term, the pressure of bears is heavy and cotton prices are running weak.

Pay attention to the hype of the weather

Cotton is an economic crop. Both supply side and demand side have influence on seasonal fluctuation, and supply side is the main driver.

From the price data of cotton futures since 2012, the probability that cotton prices will increase in a year will be 1, 2, 4, 5 and 12.

On the whole, cotton rally corresponds to 9-10 months, December, January and April.

The rise in April was mainly caused by speculation in planting area and speculation in planting season.

Spring sowing is paying close attention to capital speculation.

In short, current cotton price oscillations are running weak, and warehouse receipt digestion requires futures price matching.