Domestic And Foreign Cotton Prices Rose Cautiously To Look At This Rally.

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According to business statistics, as of June 3rd, the average price of the domestic lint spot market was 11913 yuan / ton, a rise of 45 yuan / ton compared with last Wednesday, or 0.37%, down 18.06% from the same period last year. Locusts have been swept up on the eve of cotton planting in India. With the good news of cotton enterprises gradually resuming and resuming production, the external cotton rose sharply under the ICE cotton boom, but most buyers of cotton consuming countries entered the wait-and-see state. The recovery of the consumer side still takes time, and the fundamentals of short-term supply exceeding demand have not changed. The main period of ICE cotton is up to 60 cents or so, and Zheng cotton has risen from 11400 yuan / ton to 11800 yuan / ton for two days. The problem of epidemic and supply and demand has not yet been completely resolved, and the market is cautiously cautious.

India locusts are coming again, causing cotton to rise. India accounts for about 20% of the total cotton output in the world. The market is worried about locust disaster causing cotton production to decrease. As early as February this year, the news of the outbreak of desert locusts in western South Asia helped Zheng cotton to stop trading. Earlier, the market feared that the locust plague would happen in China, but some analysts believe that the possibility of this locust leaping to China is very small. At the same time, India has quickly controlled the situation. This will play a vigilant role in cotton planting in China. At the end of May, India locust plague again. The India Cotton Association (CAI) said that 80% of the cotton sowing in northern India had been completed, and the planting of cotton in the central and southern regions will begin in the first week of June. So the output of cotton has not yet reached the point where the harvest has not yet been carried out. Moreover, India is stepping up efforts to contain locust infestation, so as to ensure grasshopper control before the summer sowing.

US cotton export contract volume is reduced, market choice ignored, weather is more important? According to the US Department of agriculture report, on May 2020 15-21, the net contracted volume of US cotton in 2019/20 was 10 thousand and 100 tons, 65% less than the previous week, and 85% lower than that of the previous four weeks. China's new contract volume dropped from 34 thousand and 800 tons to 13 thousand and 300 tons, or 61.78%. At this time, the market is more concerned about the weather, where is the logic?

Rely on weather to solve the contradiction between supply and demand? According to the global demand and demand forecast released by ICAC in June, the global cotton consumption in 2019/20 is projected to be 23 million tons, down 11.3% from the same period last year. Output is expected to be 26 million 200 thousand tons, up 2% over the same period last year. Final inventory is expected to increase to 21 million 750 thousand tons, the highest in nearly five years. And because of high inventory, low consumption and high output, the next year's international cotton prices will continue to bear pressure. Everyone knows, demand is low, supply is adequate, and cotton does not have the strength to go up. There is still a time to recover from the epidemic, which seems to be a necessary condition for the increase in cotton prices. Thus, what locust has become a climate in the futures commentary area, hail in Xinjiang, and drought in the United States cotton growing area, causing typhoon and tsunami. It's been 0202 years. Can't we make some new tricks?

Cotton yarn price changes at home and abroad on 25-29 May 2020

(source: national cotton market monitoring system, China cotton net)

Cotton yarn continues to bear pressure, India and Pakistan yarn price advantage. According to business statistics, the average price of all cotton yarn for 32S ring spinning in Shandong area was 20875 yuan / ton, down 375 yuan / ton, or 1.76%, compared with last Wednesday. As can be seen from the above table, last week, domestic and foreign cotton yarn prices continue to decline, the biggest decline is India 32S cotton yarn weekly decline of 126 yuan / ton, import yarn is lower than domestic yarn 200-750 yuan / ton, the market competitiveness is strong. The price difference of yarn and cotton is reduced by 93 yuan / ton, and the yarn profit is reduced again.

Business analysts believe that India is working hard to solve the problem of locusts. Even if production is reduced, social inventories can be sustained. Although the factory is slowly recovering, demand recovery also needs a process, the cotton price repair process will not be abrupt, from the stagnant cotton rise stagnation also side verified the rational side of the market. The output of printed cotton has not yet been finalized, and the locust has been solved early. Weather problems are not bothering cotton prices.