US Cotton Exports Decreased By 12% Compared With The Same Period Last Year.

According to the statistics of the US Department of agriculture, as of May 9th 2018/19, the United States signed a total of 322.98 tons of land cotton, 12% less than the same period last year, but completed 104% of this year's forecast (already oversold), and exporters and traders plan to use 2017/18's annual low quality and low index cotton instead of delivery.

Since July 6, 2018, China has imposed 25% tariffs on imported cotton and cotton, and Brazil and India cotton have strong competition for the global market share of cotton supply, and the quality of 2018/19 cotton and the overall decline of spinnability. Therefore, it is not easy for us cotton to sign export contracts to achieve USDA goals ahead of schedule.

On the one hand, since December 2018, with the broad oscillation of ICE cotton futures decreasing and the default of Chinese buyers continued to grow, the US cotton exporters and international cotton producers continue to downgrade the US cotton basis, leading to spot prices of EMOT/MOT, ME and other varieties of US cotton coming close to India cotton S-6, SM Brazil cotton, SM cotton, SM West Africa cotton or even 2-3 cents / pounds, the competitiveness of the United States cotton has been greatly improved, and the procurement in the non Chinese market is relatively small; on the other hand, the India cotton production in 2018/19 year has not only reduced production, but also has a prominent gap in high-quality cotton, so the phenomenon of "dumping and printing beauty" in India, Vietnam, Bangladesh and other countries is more obvious.

Recently, the India Cotton Association predicted that because of the shortage of high quality raw materials and the high domestic cotton prices in India, the import of cotton in India from 2018/19 to October 2018 will increase by 80%, and the high-quality cotton harvested in the US cotton, Brazil cotton and Australia cotton will occupy the main body.

India, Vietnam, Turkey and other national mills continue to sign the 2018/19 year to form a sharp contrast, in recent months, Chinese buyers for 2018/19, 2019/20 of the United States cotton purchasing enthusiasm obviously cooled (CFTC statistics, at present 2019/20 ICE period cotton contract at present a total of 70 thousand ON-CAll point price list), the port bonded U. S. cotton, although CNF quotation is very attractive, but the inquiry, shipment is still very difficult.

First, the Sino US trade talks are coming back again, and hopes for us cotton to enter the Chinese market in the month of 6/7 are basically destroyed.

As China and the United States impose tariffs on each other again, trade wars escalate, consultations are not substantially broken, but the possibility of reaching a consensus and signing agreements within one or two months is greatly reduced. Therefore, China has no hope of reducing or reducing tariffs on imports of US cotton before the new year.

Second, after June, Australia cotton and Brazil cotton will be listed one after another, and the substitution for us cotton will be enhanced.

According to the survey, by mid May, cotton harvest continued in southern New South Wales, Australia, which has now been completed by more than half. The weather in New South Wales and Queensland is fine, and most of the harvest is over.

It is estimated that new cotton will be listed and sold and pported in 6/7 month. Some international cotton traders and importers have already quoted price for sale. The Brazil cotton Manufacturers Association (ABRAPA) said that the cotton planting area in 2018/19 increased by 23% over last year, and most traders have been selling Brazil cotton for 9/10 months.

Third, with the Zhengzheng two down limits, domestic 2018/19 cotton and cotton reserves have been reduced by over 1000 yuan / ton, and traders' spot price resources are favored by cotton producers and middlemen.

According to the cotton Logistics Association of China Cotton Association, as of the end of April, the national cotton turnover inventory was 3 million 441 thousand and 500 tons, an increase of 961 thousand and 600 tons compared to the same period, of which 43 warehouses in Xinjiang area had 2 million 765 thousand and 400 tons of commodity cotton turnover, representing an increase of 871 thousand and 900 tons compared with the same period, indicating that domestic cotton supply was adequate.