Cotton Prices Continue To Sell Weak Cotton Yarn Downturn

According to the statistics of business data, the average price of domestic lint spot market was 11887 yuan / ton as of June 28th, which was 160 yuan / ton lower than the June 22nd price, or 1.33%, down 16.42% from last year. The global epidemic situation is still grim, short-term cotton consumption remains low, cotton yarn export orders are sparsely sparse, and cotton mills are buying at a low price stage and cautiously catching up.

　　 Good weather in Xinjiang is good for cotton growth. According to the forecast of the National Meteorological Center, most of the temperature in Northern Xinjiang is slightly lower in late June and higher in southern Xinjiang and East Xinjiang. On June 27th -29, there were moderate to heavy rain in some parts of the country. Meteorological conditions have a slight effect on the growth of cotton in Northern Xinjiang, which is beneficial to the growth of cotton in southern Xinjiang and eastern Xinjiang.

Under the background of global consumption downturn, the international epidemic control situation, the implementation of Sino US trade agreements, and the increase and decrease of global output are the main entry points for cotton prices to rise. First, domestic output is basically stable, and the way to reduce production is half cut. Second, if the Sino US trade agreement is as good as usual, the good stimulus will be digested very early; if there is divergence, confidence in the market will be hit, the cotton price will probably have a deep bottom. The rest is the recovery of cotton consumption. ITMF recently conducted fourth surveys in 600 members of the world. The results showed that the textile orders from around the world dropped by more than 40% from the outbreak of the March 1, 2020 pandemic to June 8, 2020. Respondents generally agreed that textile orders would resume in the fourth quarter of 2020. But it is also predicted that the outbreak will probably be the two outbreak at the end of the year, and the recovery of demand will be tested by time.

　　 The difference between domestic and foreign cotton prices is negative, and the domestic cotton market is dominant. Last week (6.22-6.26), according to relevant understanding, the "double 28" cotton picking price was concentrated at 12200-12400 yuan / ton, and the price of hand picked cotton was concentrated at 12400-12600 yuan / ton, Brazil cotton 12500-13200 yuan / ton, Australia cotton 14500-15300 yuan / ton, India cotton 11800-12100 yuan / ton, and American cotton 12600-13500 yuan / ton. The price of domestic cotton is lower than that of other cotton except India. Domestic cotton has obvious price advantage and is conducive to domestic cotton consumption.

Cotton yarn price changes at home and abroad on 15-19 June 2020

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

Last week (6.15-6.19), the price of foreign cotton yarn continued to be weak, and the price difference between internal and external yarn was basically evaluated. The price difference of yarn and cotton has increased, and the profit of cotton mill has eased.

According to business statistics, as of June 28th, the average price of all cotton yarn for 32S ring spinning in Shandong area was 20675 yuan / ton, down 200 yuan / ton, or 0.96%, compared with the first half of June. The quotation of pure cotton yarn is not good. According to some enterprises in Henan, the demand for pure cotton high branches is low and the operating rate is low except for a small number of blended yarn and low spin yarn spinning enterprises. Through the Dragon Boat Festival holidays, many enterprises stretch their holidays, and the clothing industry also opens summer holidays.

Business analysts believe that although the output of cotton may have been reduced under the influence of the epidemic, the sharp decline in consumption is still a difficult problem for cotton market, and the topic of oversupply remains unchanged. Because of the different needs of the downstream, cotton yarn sales show a partial phenomenon, the cotton yarn market is cold, and the price of the cotton mill is strong, but the actual transaction price is obviously not as good as the quotation on the table. In textile off-season, cotton mill's purchase of cotton mill is slowing down. The purchasing strategy of dips has certain support for the cotton market. The cotton price is limited, and the cotton price is expected to be 11700-11200 yuan / ton in July.