Zheng Cotton'S Center Of Gravity Moves Downward, Spot Price Fluctuation Is Limited.

With the rapid digestion of the good news of 500 thousand tons of Xinjiang cotton and the interference of recent Sino US trade news, the focus of Zheng cotton futures has shifted down. The main CF2001 contract dropped to around 12580 yuan / ton at the beginning of the week around 13000 yuan in November 21st, or nearly more than 400 points. This resulted in a marked increase in the number of high cost performance point price resources. According to tracking the spot market of imported cotton and Xinjiang cotton, no matter traders or ginning mills, the high market quotations have been reduced, but there is not a strong desire to sell prices substantially.

At the beginning of the week, the prices of imported cotton increased, and the inquiry prices of imported cotton in Qingdao port and Zhangjiagang increased. In addition, with the development of the quota application in the new year, individual enterprises increased the purchase volume of imported cotton in stages in order to timely allocate the quotas. But compared to the same period last year, the scale of procurement is not large, mainly because the current textile enterprises are still worried about the future market, and continue to maintain the strategy of "follow suit". After the fall of Zheng cotton prices, the pace of downstream purchases slowed down significantly, and the mentality of port traders wait-and-see. A Qingdao port trader feedback, at present, the downstream demand is not strong, is fundamental, if the current situation of price reduction, the buyer may not "pay the bill", and the current clearance spot cost solidification, this year cotton market downturn, has been small profits but quick turnover, and then continue to reduce prices are facing losses. Qingdao cotton Brazil today quoted 13100-13400 yuan / ton, and Australia cotton quoted 15400-15600 yuan / ton.

Xinjiang ginning factory has a strong mentality. Because the new cotton harvest is coming to an end, the price of seed cotton is relatively high this year, and the processing cost of enterprises is hard to drop. A cotton processing enterprise in Akesu lamented that the previous planning was disrupted, and now that cotton purchase is coming to an end, it is found that it is not rational enough to follow blindly. At present, the futures price is not high, temporarily unable to achieve hedging, can only wait for the right opportunity to make plans. Some cotton traders in Xinjiang bought feedback. Some of the ginning plants were locked up by some spot companies or large trade in the early part of this year, and some ginning factories were offering higher prices. The low price of ginning plants can not be sold, and the situation that traders and textile mills do not want to buy at high prices is hard to break. Today, Xinjiang's 3128 class cotton picking price is priced at 13000-13300 yuan / ton and hand picked cotton is 13100-13500 yuan / ton.

Overall, the cost of cotton processing in the new year is high, which is basically the same as the current market price. But within a certain limit, spot prices are slightly stronger, supported by the cost of cotton.