Is 2019/20 Beautiful Cotton Export "Picturesque"?

According to the USDA report, as of August 1st, the US land cotton signed a total of 1 million 688 thousand and 700 tons in August 1st, completing 55% of the new year's forecast (5 years averaging 41%). Although the Sino US trade war led to a prolonged downturn in the import volume of Chinese buyers, it did not affect the sales of US cotton in the global market. It is worth noting that since mid July, China began to purchase 2019/20 cotton in the United States, in July 19th -25 days, and in July 26th -8 months 1 days, the two week signing volume reached 11 thousand tons and 13 thousand and 600 tons respectively, with a significant increase in ring ratio and year-on-year growth. In addition, the data released by USDA is that the export volume of US cotton in the 2018/19 is 10% lower than expected, and about 1 million 672 thousand tons of us land cotton knot has been transferred to 2019/20.

Can the signing of the US cotton export in 2019/20 be "one of the best and ahead of the rest"? The author's view is that the probability of "getting up early and catching up late" is not large. It does not exclude the same export situation as "2018/19", which has led to an increase in the final inventory of the USDA monthly report, and three of the final inventory. The reasons can be summarized as follows:

First, 2019/20 has strong export competitiveness in the global market. According to USDA, Brazil Cotton Association, CAB and so on, the cotton output in Brazil and India will increase significantly in this year. The output of cotton in Brazil will exceed 2 million 665 thousand tons, an increase of 32.9% over the same period last year, and the substitution for American cotton will become more and more prominent. The recognition of yarns in India, Pakistan and Vietnam will continue to increase in recognition of Australia and Brazil cotton.

Two, ICE cotton futures plummeted, resulting in November 2019 to February 2020 default probability of shipment and delivery increased significantly. From the statistics point of view, since April 2019, the ICE main contract has dropped to 57.26 cents from the 77.45 cent oscillation, a total decrease of 20.19 cents, or 26.07%, and the fall amount is obviously higher than that of the buyer. Taking into account the significant increase in cotton production in the northern hemisphere in 2019/20, the sluggish global cotton consumption and the risk of economic crisis, ICE's main contract has fallen below ten years' low point of 54.19 cents. Under the premise of heavy losses and low spirits, the operation of the US cotton contract and the negotiation or repurchase of the sales party will increase.

Three, the Sino US trade consultation has been stranded by the US's repeated and unyielding and cunning dishonesty. Whether the contract can be implemented and whether to continue signing the US cotton market in 2019/20 is unknown. In order to promote the Sino US trade negotiations in September and implement the outcome of the meeting of heads of state between G20 and Osaka, China has already purchased the US agricultural products (mainly soybean, cotton and so on, but only a large amount of shrinkage). However, the premise of implementing these contracts is the smooth dialogue between the two sides of the Sino US trade, based on equality and mutual respect. If the US side is still bent on its own way and cocoons and bind itself, the cancellation of the contract by Chinese enterprises, the breach of contract and even the possibility of eliminating the US cotton from the procurement list will be great.