The Cotton Market Will Continue To Be Cautious.

 

As for the international cotton market, the recent growth of Texas rainfall is beneficial to the growth of American cotton. As of July 7th, the growth of new cotton in the United States reached 54% above the same period last year, 13 percentage points higher than that in the same period last year. India's monsoon rainfall is higher than the long-term mean for the first time this year. As of July 10th, the rainfall in India is 28% higher than that in the past 50 years, which counteracts the effect of the lack of rainfall on cotton planting in June. The supply and demand forecast for USDA7 increased by 102 thousand tons to 27 million 387 thousand tons in, reducing consumption from 218 thousand tons to 27 million 56 thousand tons. The global demand for production exceeded the demand from 11 thousand tons last month to 331 thousand tons.

 

The spot cotton market in India was light. Last week, the net contract volume of US cotton exports decreased by 62% to 12 thousand and 100 tons compared with the previous week. China continued to break the contract. Cotton prices in India decreased, market enquiries and transactions were slow. International cotton yarn inquiry shipments continued to slump, Pakistan's new revenue, Pakistan yarn sales slow, downstream cloth and garment factories demand is still weak. In the context of tight international trade and financial market fluctuations, it is expected that the international cotton market will still be cautious in the short term, and India needs to pay close attention to the weather conditions such as monsoon rains and cotton fields in the United States.

 

The domestic cotton market is running weak. According to customs statistics, in June, exports in China decreased by 1.3% compared with the same period in the US dollar, while imports dropped by 7.3% compared with the same period last year. The export volume of textile and clothing decreased by about 3.2%. The recent resumption of Sino US negotiations is full of uncertainties and the international economic environment is weakening. In the future, China's trade is still facing some pressure, and the spinning and weaving enterprises are still more cautious in terms of orders and production.

 

Domestic cotton market, according to the monitoring system data, as of July 12th, the annual sales rate of new cotton in the whole country was 75.8%, down 8.6 percentage points compared with the same period last year. The output was calculated by 6 million 105 thousand tons, and there were about 1 million 477 thousand tons of new cotton sold for sale in the whole country. The cotton futures margin of Zhengzhou cotton continued to decrease from 13 thousand tons to 620 thousand tons last week.

 

Last week, after the meeting between heads of state of China and the United States, a slight improvement in the shipment of cotton yarn in the lower reaches led to a slump in the futures market this week. Cotton continues to fall, companies continue to reduce prices to inventory, reduce the pressure of funds, but finished goods inventory is still high. According to monitoring system data, in early July, the yarn inventory of enterprises surveyed by sampling was 29.1 days, higher than the average level of 14.8 years in the past three years, and the existence of 49.2 days was higher than that in the past three years, with an average of 10.5 days. Due to the uncertain influence of Sino US trade negotiations, market pessimism continues, and all parties in the market dare not rush to raise prices. In the absence of major favorable conditions, the domestic cotton prices may continue to be cautious in the short term. We need to pay attention to the weather changes in Xinjiang after the new cotton enters the flowering and Bolling period.