Why Is The Market Getting Better?

Recently, some changes in the market have caused concern in the industry. There are two major changes.
1, the turnover rate of Xinjiang cotton entering and selling has dropped sharply. Data show that: since February this week, 10-12 days in February, the rate of entry and sale was 27.33%, 18% and 32% respectively. In terms of turnover rate alone, compared with the previous week, there was a difference between cloud and mud.
2, Zheng cotton rebound has been exhausted. Last week, Zheng cotton first slowed down and then rebounded quickly. Entering this week, Zheng cotton range oscillation, indicating that the strength of a sharp rebound has exhausted. As of February 12th, the main cotton CF2005 contract closed at 13070 yuan / ton, compared to 11 yuan 13125 yuan / ton closing price fell 55 yuan / ton.
From the data point of view, the market is cooling down. But focusing on the whole market, data cooling does not mean that the market is deteriorating. On the contrary, I believe that the market is gradually improving.
First, the turnover rate of Xinjiang cotton entering and storing has revealed positive factors. First of all, the daily reserves of 18000 tons have not changed, Xinjiang cotton can be fully stored. Secondly, some enterprises in Xinjiang are willing to slow down the bidding process under the bullish mentality. Many traders and middlemen said that after the outbreak of cotton, there would be a retaliatory rebound.
Therefore, the decline in the sale rate is a manifestation of the positive attitude of the market, and everyone is waiting for the price to sell.
Two, although most textile mills and printing and dyeing factories have not yet resumed work, the production of masks is already in full swing. Most regional notices require enterprises to return to work after February 10th, but because of traffic and workers' returning to work, in fact, as of February 13th, there are still few cotton mills, weaving mills and printing and dyeing mills everywhere.
However, because of the epidemic situation, masks and other protective equipment are scarce. After the Spring Festival, a large number of enterprises began to try to "cross-border" production, and the original closure and closure of mask manufacturers resumed their old businesses. According to statistics, from January 1, 2020 to February 10th, the new business scope of the whole country covered about 2.6 enterprises, including medical devices, disinfectant products, respirators and other protective products.
Capacity explosion. Coupled with the development and Reform Commission hard shell voice: Mask surplus capacity after the outbreak of the government purchase and storage.
To sum up, the recent market has gradually improved and there is no dispute about the enhancement of corporate confidence. It is not ruled out that the cotton price will rise substantially after the outbreak.