Lack Of Terminal Demand And Downward Trend Of Cotton Futures Prices

Last week (August 19-23), there was no news of progress in the thirteenth round of negotiations between China and the United States planned for September. With the approaching of the third round of tariffs in September 1st, market panic was strong, new orders were not good, terminal consumption was insufficient, cotton spot transactions were scarce, and futures prices shook down. Last Friday (August 23rd) evening, China announced countermoves against the US's third round of tax increases, and domestic and foreign futures and stock markets fell again. New cotton is picking and coming to market. In the face of sales difficulties of Chen cotton, processing enterprises dare not act reckless, and the date of listing may move back. Cotton price CNCottonB index price 13516 yuan / ton, week fell 49 yuan / ton, compared with Zheng cotton futures CF1909 contract, spot premium 1326 yuan / ton, week expansion 106 yuan / ton.

Futures. As the September delivery approached, the funds shifted gradually. In January, there was a phenomenon of decreasing monthly growth in recent months. In addition, at the end of the weekend, the president of the United States increased the tariffs, and the prices of all cotton contracts fell sharply, indicating that the market pessimism remained the same, and the trend of cotton prices in the future was not optimistic. Zheng cotton main CF2001 contract closed on 12730 yuan / ton last Friday, the week fell 110 yuan / ton, Zhou traded 1558582 hands, reduced 690912 hands, reduced 30.7%, holds 505248 hands, the week increased 32852 hands, the increase 7%, the disk narrow oscillations, the transaction reduced, the fund has flowed out. China announced the counter measures, the United States may be overweight, the trade war may be further upgraded, the September negotiations will be difficult to increase, the new cotton will soon be listed, and the fundamentals are bad. This week zhengmian CF1909 contract may test the 12000 yuan / ton integer pass.

Us disk: exports fell, China announced counteraction measures, the disk fell sharply, ICE main contract in December closed at 58.18 cents / pound, fell 194 points, this week may test before low support, continue to pay attention to the Sino US trade war negotiations progress and cotton weather news.

On the spot. The order of the cotton mill is insufficient, and the production is restricted to stock. The raw materials for market purchase are mainly rigid demand, the price points are low, the positions are low, and the turnover is few. With the advent of the new cotton market, the repayment pressure is rising, and the price reduction is intensified, which is close to the spot price resources. At present, the "double 29" machine is quoted at 13000-13200 yuan / ton, and the "double 28" picking price is 12900-13100 yuan / ton; the main transaction price of Xinjiang cotton in the inland bank is in the range of 12800-13800 yuan / ton according to the quality; the price of customs import of West Africa and India cotton is 12800-13200 yuan / ton, and the price advantage is lacking. Brazil cotton is large and the price is slightly lower than that of Xinjiang cotton.

Operation suggestion. China announces that the US may increase the number of anti tax measures against the US's third round of tax increases. The trade frictions between China and the United States will face further escalation. Market panic will increase, confidence will be impaired, new cotton will be on the market, cotton prices will be lower or new lows.