Demand Recovery Still Takes Time, And Short-Term Upward Pressure On Zheng Cotton Remains.

The first part is the summary of basic data of domestic and foreign cotton market.

This week, the CRB international commodity price index closed at 124.75 cents / pound, basically unchanged, up 0.1 from last Friday. Recently, it was concerned about the pressure near 130. Domestic Chinese goods finished 134.81 in May 15th, down 0.44 from last Friday, and 136 above the short-term pressure. ICE main contract 07 signed a large number of Chinese US cotton contracts due to China's purchase. According to the statistics of the US Department of agriculture, China's net signing of the three week China's net contract for three weeks in April, 17-5, 95 thousand and 800 tons, 49 thousand and 300 tons, 44 thousand and 900 tons respectively, accounted for 97.16%, 58.69% and 83.15% of the total export volume of the US cotton in the week respectively, and the strong export data made the ICE main contract strong, and in the late April, it had broken up 55 cents / pound, and 2019/20 And continuously hit 58 cents / pound, 60 cents / pound pass. The domestic Zhengzhou cotton 09 contract shows that it is in the process of long and short play, maintaining the Zhen trend.

On the whole, under the current downstream domestic orders have improved, it is understood that the export orders in Guangdong are slightly reflux, the downstream mentality has improved somewhat. The cotton textile raw material purchase intention of Zhengyang cotton 09 contract 11500 and below is better. At present, textile enterprises are mostly buying and buying. But at present, the demand for downstream from terminal is limited, and the driving force of cotton rising is still limited by downstream demand. If the downstream fabric factories and intermediate traders have a larger margin of cotton yarn repair, and the cotton yarn profits can be repaired under the condition that the yarn price can be uplained, there will be more driving force for cotton rising. But at present, the cash flow of the downstream is more intense, and the uplink of the cotton price will still be drawn up due to the limited or limited replenishment of raw materials, so the short-term cotton price will continue to be arranged sideways; but in the long run, the cotton price is in the historical bias. At a low level, the market has a low willingness to sell short; secondly, various countries have gradually introduced relevant policies to stimulate the pace of economic recovery, which will play a role in underpinning cotton prices; on the other hand, the growth trend of the global epidemic has eased, and export orders are showing signs of backflow, though limited in scope, they will continue to be repaired as time goes by. In the long run, the cotton price center will gradually move upward, and the recommended long position of the bottom line is controlled at 10-15%.

First, weekly data overview

Prices of major commodities and cotton

　　 This week, the CRB commodity price index remained basically unchanged from last Friday, with a slight increase of 0.1. According to the varieties, the crude oil performance was stronger, and the weekly price rose 3.69 yuan / barrel, and it closed 29.78 cents / pound on Friday. Compared with last Friday, agricultural products were mixed with each other. Soybean beans and American corn showed different ranges of decline, of which the largest decrease in soybean beans, and 13.3 cents / bushel in the week; the ICE period cotton 07 contract price rose 1.95 cents / pound. The mainstream cotton resources were mixed with each other last Friday. The domestic cotton yarn price index maintained a downward trend for 10 consecutive weeks, down 70 yuan / ton this week.

On the spot side, as of May 16th, Xinjiang processed 5 million 171 thousand and 300 tons and accumulated a total of 5 million 107 thousand and 100 tons of public inspection. This week cotton spot prices first fell and then rose, the overall fluctuation was small, and spot trading increased. This week, spot trading is still mainly based on spot price. On May 12th -14, in the case of Zheng cotton's slight decline, the cash trading atmosphere was obviously better than that in April. After the rise of Zheng cotton on Friday, spot trading was significantly weaker. This week, large cotton traders have a large spot turnover, while other cotton traders have only slightly improved liquidity in spot trading. At present, most of the textile enterprises need to replenishment after the raw material consumption of the downstream textile enterprises. Individual spinning enterprises add half a month to a month's cotton raw material inventory on the original stock basis.

Downstream market, this week's pure cotton yarn market active, mainly downstream need replenishment, and textile enterprises have been reducing prices to inventory, so this week, the pure cotton yarn Market shipments accelerated, spinning enterprises comprehensive inventory level slightly decreased, and the starting point, textile enterprises started to gradually restore to the level before the beginning of stabilization.

Zhengzhou cotton market, Zhengzhou cotton main force 09 contract during the week, the cumulative price fell 10 yuan / ton, positions reduced by 14 thousand to 390 thousand hands, turnover increased 453 thousand hands, to 1 million 972 thousand hands, Zhengzhou cotton this week, the performance of the first to suppress after the increase in spot trading volume, also attracted a lot of bottom money admission, active trading.

The second part is the basic situation of the domestic market.

1, textile main raw material trend

　　 In terms of raw material prices, polyester prices dropped slightly compared with last week on Friday, viscose prices rebounded, cotton yarn prices continued to fall, cotton spot price index rose slightly, Zheng cotton 09 contract slightly down 10 yuan / ton compared with last Friday.

2, cotton yarn price trend

　　 In May 15th, the market price of pure cotton yarn and cotton yarn continued to decline compared with last Friday, and the price of polyester yarn remained stable.

　　 In May 15th, the price of US dollars imported yarn fell sharply compared with that of last Friday.

　　 In May 15th, the price of external yarn denominated in Renminbi fell sharply on Friday.

　　 The price difference between May 15th and May 15th was 254 yuan / ton. Last Friday, the spread price difference was -1091 yuan / ton, and the spread was narrowed further.

3. Comparison between domestic cotton futures price and international cotton price index (including tax).

　　 In May 15th, the domestic cotton spot price index CCI3128 reported 11515 yuan / ton; FC IndexM reported 68.67 cents / pound, the price was 1% yuan, the price was 11934 yuan / ton, and the discount tax was 13723 yuan / ton. The spot price index and the cotton price ratio under sliding tax are -2208 yuan / ton, last Friday was -2214 yuan / ton. Compared with the 1% tariff, the price is -419 yuan / ton. The spot price index and the slip price difference narrowed slightly.

In May 15th, the main contract 2009 closed at 11645 yuan / ton, and the price difference with FC Index M (sliding tax) -2078 yuan / ton, last Friday was -2022 yuan / ton, and its FC Index M price difference -289 1% yuan / ton under the tariff. The price difference between Zheng cotton and sliding tax has been widened.

　　 As of May 15th, the main contract of ICE was closed at 57.83 cents / pound in July, 9045 yuan / ton on the disk price, and 2599 yuan / ton in the 2009 contract with zhengmian 2009. The trade price of 10 cents was calculated to be RMB 11880 yuan / ton, and the price difference between Zheng cotton 2009 contract (zhengmian -ICE cotton) was RMB yuan / ton.

The third part is Zheng cotton market analysis.

1, Zheng cotton warehouse receipt and effective forecast situation

　　 As of May 15th, the registered warehouse receipt of Zheng cotton was 26895 (1 million 156 thousand tons), effective forecasts were 2910 (125 thousand tons), warehouse receipts and effective forecasts were 1 million 281 thousand tons, last Friday reduced 1 million 344 thousand tons, 63 thousand tons, the total amount of warehouse receipts continued to decrease, the disk pressure has been released.

2, Zheng cotton current price difference analysis

　　 As of May 15th, the difference between Zheng cotton futures price and CCI3128B index was 192 yuan / ton, and 149 yuan / ton in April 30th.

3, Zheng cotton price analysis

On the macro level, up to 6:10 at 6:10 in Beijing, there are more than 4 million 510 thousand confirmed cases of new crown pneumonia worldwide, reaching 4511470 cases, with more than 302 thousand cases of cumulative deaths, reaching 302513 cases. The total number of confirmed cases of new crown pneumonia in the United States is the largest in the world, exceeding 1 million 450 thousand cases, reaching 1453630 cases, and accumulative death cases exceed 86 thousand cases, reaching 86774 cases. At present, there are signs of growth in the confirmed cases of the global epidemic, and countries have also issued relevant policies to accelerate economic recovery. Italy Prime Minister Giuseppe Conte announced on 13 th that the Italy government has approved a "restart act", which includes a total of 55 billion euros ($59 billion 600 million) package of economic stimulus plans to help businesses and families overcome the impact of the new crown epidemic. Strike. The Prime Minister of Italy said that the size of the funds to be funded by enterprises would be between 15 billion and 16 billion euros, which would be fulfilled in various forms. Japanese Prime Minister Abe Shinzo announced on the 14 day that the state of emergency in 39 counties other than 8 prefectures, including Kyoto and Osaka Prefecture, should be lifted. It was the first time that Japan declared a state of emergency in April 7th and the state of emergency in April 16th expanded to the state for the first time. Although Powell dispelled the possibility of negative interest rates in the United States, he said he would continue to make full use of all kinds of tools until the crisis passed.

However, the current global consumption is still in a weak position. According to the data released by the General Administration of customs, the export volume of textiles and clothing this year shows that the export volume of textile and clothing has declined sharply in the first quarter of this year, which is mainly affected by the new crown pneumonia epidemic. The total export volume of textiles and clothing in 1-2 months was similar to that of the same period last year, but the decline in clothing in the first quarter was even more obvious. This was due to the fact that in March the European Union cancelled or postponed the clothing orders in large areas, which had a greater impact on clothing exports than textiles. The total export volume of textiles and clothing and clothing in the 1-4 months is still less than that of the same period last year, and the total export volume of clothing declined further compared with the first quarter, but the total export volume of textiles increased year by year. This is mainly due to the sharp increase in the export of anti epidemic products in textiles in April, which has stimulated the increase in total textile exports, while clothing exports continue to be affected by the epidemic, resulting in a further decline in demand.

From the perspective of the global cotton pattern, according to the latest global cotton supply and demand forecast released by the US Department of agriculture (USDA) in May, the global cotton output in May is slightly higher than that in April, and consumption is again sharply reduced, ending inventory is increasing. The total output of cotton in the world is 26 million 709 thousand tons, an increase of 210 thousand tons from the previous month, and the global consumption of 22 million 861 thousand tons, with a further reduction of 1 million 216 thousand tons; import and export trade. It can easily be reduced by about 8 million 640 thousand tons, or about 210 thousand tons. The end of the world stock of 21 million 155 thousand tons, a sharp increase of 1 million 285 thousand tons; second only to 2013/14 and 2014/15, the third highest since the historical record, and the global sink to the ratio rose to 93%, the highest level since the historical record. The overall report is negative. But from the domestic and international trend, the price of the report dropped slightly, followed by a rebound in the price. With the help of the policy and liquidity injection, at the present stage, we need to pay attention to whether the demand for textiles and clothing in the lower reaches should be restored at the same time.

At home, according to the cotton Logistics Association of China Cotton Association, the survey data of 152 cotton delivery and supervision warehouses, social warehouses, bonded area warehouses and processing enterprise warehouses in 18 provinces and municipalities nationwide showed that by the end of April, the total cotton business inventory in China was about 4 million 297 thousand and 500 tons, a decrease of 339 thousand and 200 tons from the previous month, a decrease of 7.32%, which is still higher than that of 502 thousand and 600 tons in the same period last year. In April, domestic textile enterprises basically recovered, but demand was insufficient. In April, the decline in commercial inventories was unchanged from last month. According to the specific warehouse, the warehouse in Xinjiang decreased by 500 thousand tons, the decrease was obviously higher than the total amount of the whole country. Xinjiang cotton flowed into the mainland. However, because of the weakness of downstream consumption, Xinjiang cotton inflow was hard to digest quickly, resulting in the increase in the turnover of commodity cotton turnover in the mainland in the end of 4, and the increase of 165 thousand and 500 tons in the ring. Overall, the total volume of commercial inventories in April is in the peak in recent years, and high inventories undoubtedly constitute a certain pressure on cotton prices. In addition, the inventory of cotton industry showed that as of the end of April, the inventory of textile enterprises in the cotton industry was 673 thousand and 400 tons, down 40 thousand and 800 tons from the end of last month. The stock of disposable cotton in textile enterprises was 777 thousand and 600 tons, a decrease of 56 thousand and 600 tons from last month. Because the April new crown spread abroad is more serious, the impact of external demand on China's textile market is obvious. The consumption of domestic demand has not fully recovered. Although the price of cotton is relatively low, the pressure of spinning enterprises is very high. The downstream market is deserted, the order is scarce, the enterprises are facing the dilemma of finished products, namely inventory. The yarn stock of textile enterprises increased this month, and the yarn stock of the textile enterprises is 28.45 days, an increase of 3.68 days from last month. High inventory undoubtedly constitutes a certain pressure on cotton prices.

This week, the CRB international commodity price index closed at 124.75 cents / pound, basically unchanged, up 0.1 from last Friday. Recently, it was concerned about the pressure near 130. Domestic Chinese goods finished 134.81 in May 15th, down 0.44 from last Friday, and 136 above the short-term pressure. ICE main contract 07 signed a large number of Chinese US cotton contracts due to China's purchase. According to the statistics of the US Department of agriculture, China's net signing of the three week China's net contract for three weeks in April, 17-5, 95 thousand and 800 tons, 49 thousand and 300 tons, 44 thousand and 900 tons respectively, accounted for 97.16%, 58.69% and 83.15% of the total export volume of the US cotton in the week respectively, and the strong export data made the ICE main contract strong, and in the late April, it had broken up 55 cents / pound, and 2019/20 And continuously hit 58 cents / pound, 60 cents / pound pass. The domestic zhengmian 09 contract was shown to be in the process of short and short play in the week.

On the whole, the growth of the global epidemic has slowed down. The positive fiscal and monetary policies adopted by the various countries against the epidemic have provided a bottom line for the overall commodity price. And the recent rebound in crude oil prices has also led to a slight rebound in CRB and Wenhua commodities, and the popularity of commodity markets has been restored. The price area, the lack of motivation for the short selling of funds, therefore, although we have always been weak in terms of the fundamentals of the industry, Zheng cotton will continue the low side trend before the supply is sufficient and the downstream consumption is not fully recovered, but the current epidemic will eventually be controlled, so the recovery of the downstream terminal is a matter of time, so in the long run, the cotton price will gradually become the focus. It is suggested that the position of long - distance bottom - up funds should be controlled at 10-15%.

　　 This week, the 09 main contract of zhengmian main force was first suppressed and later raised, and the period price moved from the upper track to the middle track, and then rebounded slightly at the support price of the middle track. As a whole, the period price continued to oscillate. The weekly price dropped by 10 yuan / ton, and the position decreased by 14 thousand to 390 thousand. The turnover increased by 453 thousand to 1 million 972 thousand hands. From the technical aspect, MACD, 0 columns above the red column weight, showed that the popularity of many bulls remained strong. The current price is constrained by the trajectory of Brin, and the brin channel is in a closed form. It is expected that the short term wide shocks may be too large, and the recent attention will be paid to the changes in storage capacity.

The fourth part is international market analysis.

1, US cotton export dynamics

　　 04.24-05.07 this week, the United States signed 53997 tons of cotton sales in the 2019/20 year, 36% less than the previous week, but the average contract volume increased by 50% over the past four weeks. The shipment of 54824 tons of Upland Cotton decreased by 35% compared with the previous week, and the average shipment volume decreased by 20% compared with that of the previous four weeks.

　　 As of May 5th, CFTC holdings data showed that the fund's net multi position was -13023, after a week's data was -11485, and the fund's net long positions decreased slightly, which was 1538 fewer than last week.

2, ICE cotton analysis

　　? This week, the ICE cotton main force 07 contract, strong performance in the week, the period price from the middle track upward movement, the period price accumulatively rose 1.96 cents / pounds, at present is constrained by the upper track pressure. From the technical indicators, the MACD index is a gold fork which diverges and breaks through the 0 axis and is in a strong area. MACD red column volume shows that the popularity of many people is strong, and KD indicators are fitted to form golden fork to diverge from the upward, and the technical indicators are strong. Recent attention to changes in storage capacity.

The fifth part is operation suggestion.

It is suggested that the upstream cotton enterprises should continue to do well in risk management, keep the value in line with the progress of sales, and keep the value of the unhedging resources waiting for Zheng cotton to rebound to higher spot spot sales or spot price sales, or sell deep virtual call options to make up for the loss of spot positions.

It is recommended that cotton trade enterprises set up virtual stocks near the low price area of history.

Textile enterprises already have (virtual stock) positions can be left on the right amount, at the same time, according to the order situation, just need to replenishment.

The current companies are going to have a strong base to speed up the sale of spot prices.

It is suggested that the long term bottom line funds that have already been admitted in the early stage will be controlled at 10-15%, and those who have not entered the market will be placed in a low position and the positions will be controlled within 10%.