Dancing With Wolves: Observation Of Sino US Trade And Cotton Textile Market

This week, the market price descended all the way down again into the haze period, and this fall seems to be the result of multiple reasons, not entirely caused by Sino US trade friction.

Review of important news

In September 24th, President Trump spoke frequently in the general debate of the UN General Assembly, criticizing China for failing to fulfill its WTO commitments. In response, we responded to the press conference of the Ministry of foreign affairs and hoped that the United States would listen more to other countries' views on the current international situation and listen to their voices on upholding multilateralism.

A few days ago, the United States released three exclusive lists of tariffs on China, involving more than 400 commodities. China has responded positively to this. In September 26th, the State Development and Reform Commission and the Ministry of Commerce said that China supports the relevant enterprises to continue to purchase certain quantities of soybeans, pork and other agricultural products in accordance with the principles of marketization and the WTO rules. The State Council Tariff Commission will continue to levy tariffs on these purchases.

In September 26th, at the invitation of the United States, Liao Minyu, deputy director of the central finance office and vice minister of finance, led a delegation to visit the United States, and held consultations with the US side on Sino US economic and trade issues, preparing for the thirteenth round of Sino US economic and trade consultations held in Washington in October.

Market price dynamics

On September 23rd -27, the market trend was not satisfactory. Futures market, domestic cotton main contract (CF2001) September 27th settlement price of 12205 yuan / ton, compared with last Friday's settlement price fell 700 yuan / ton; American Cotton Futures (ICE1912), September 27th settlement price of 60.90 cents / pound, a drop of about 0.5 cents / pound; Zhengzhou cotton yarn main contract (CY2001) September 27th settlement price of 20085 yuan / ton, compared with the same period fell 775 yuan / ton. From the domestic spot market, in September 27th, the domestic 3128B cotton price index was 12425 yuan / ton, compared with last week, the total price dropped by about 200 yuan / ton, and the price index of pure cotton 32 CY C32S was 20110 yuan / ton, the overall price decreased by 20 yuan / ton last week, and the price was relatively stable. From the situation of cotton reserve transaction, when the weekly price was 12720 yuan / ton, it rose 182 yuan / ton compared with the previous week, and the turnover rate was lower on Monday, and the average price was lower than last week.

　　 The reasons for the collapse are as follows: 1, President Trump publicly denounced China. Recently, China has also cancelled some US cotton orders, making the market's anxiety rising again in the Sino US negotiations in the early October. 2, the new cotton market is going to be listed in large quantities, the cost is much lower than that of Chen cotton, and Chen cotton's inventory is hard to drop. 3, "Kim Gu" is about to go. Although the company's inventory clearance has achieved some success this month, the prosperity of the peak season is less than that of previous years, and the market confidence has dropped slightly compared with the beginning of the month.