The New Hard Core Price Is Coming

Since the first ten days of July, ice cotton futures has come out of a "V" market, with the two shoulder highs of 64.90 cents / pound and 65.05 cents / pound respectively. Although the main contract suddenly dived on August 7, and the bottom of the day was close to 62 cents / pound, the overall focus of ICE Futures continued to rise from the perspective of technology, fundamentals and peripheral markets, and the trend of upward test against 62 cents / pound remained unchanged, Cotton textile enterprises and traders may have missed the opportunity of signing and purchasing the main contract of 59-62 cents / pound.

At the same time, cotton futures rose from 1744-794% to 8144 CFL at the same time. Some international cotton merchants and trading enterprises judge that the bottom of ice's main contract is still in the upward channel, and it is a high probability event that the Bulls break 65 cents / pound or even 68 cents / pound again. This round of rebound since the beginning of April has a long time, stable rise and sufficient confidence.

Why is ice "easy to rise but difficult to fall" and to catch up with more? The opinions of cotton related enterprises and investment institutions are summarized as follows:

First, USDA has basically formed a "lift" for ICE Futures. First of all, the high temperature and drought in West Texas, the main cotton producing area of the United States, lasted for a long time, and the yield of discarded cotton was high; secondly, the proportion of good seedlings of American cotton decreased significantly, and worries about the yield and quality of American cotton in 2020 / 21 were raised; thirdly, due to the obvious oversold of American cotton in 2019 / 20, some contracts were forced to be carried out in 2020 / 21, stimulating ice to go up; finally, in August / September, hurricanes landed in the United States one after another In cotton producing areas, the fund should catch the opportunity of speculation at any time;

Second, China will still sign a large number of contracts to import American cotton in 2020 / 21 in the second half of 2020. According to foreign reports, China and the United States plan to hold high-level talks on August 15, To assess the progress of China's implementation of the phase I trade agreement, white house senior economic adviser Larry Kudrow said on Tuesday that the first phase of the US China trade agreement was "making good progress" and that China continued to buy US goods, especially commodities, under the phase I trade agreement with the United States. Yi Gang, governor of the people's Bank of China, said that he would continue to implement the first phase of Sino US economic and trade agreements and implement the financial reform and opening-up measures announced in recent years. The above shows that the first phase of Sino US trade agreement will continue to advance at a high speed, and the pace of China's import of agricultural products (including cotton) from the United States will accelerate in the "post epidemic" era;

Third, the unlimited monetary stimulus policies of the Federal Reserve and the US government can not stop, and the "Carnival" of US finance, stock market and commodity futures continues. In terms of stimulus scale, the new round of stimulus proposed by the Republican Party is $1 trillion, while the Democratic Party supports $3.4 trillion. The major difference between the two parties in the United States lies in the amount of fiscal stimulus, rather than whether it should be introduced or not. However, with the depletion of early stimulus checks, unemployment subsidies to American families, and emergency loans and grants to troubled enterprises and state and local governments, the two parties will eventually reach an agreement to pass the stimulus plan. Moreover, the president of the United States can implement it The government order only reduced the scale of stimulus, so the US stock market "only higher, not the highest.";

Fourth, in 2020, the global grain growth momentum is strong, and there is still a lot of room for cotton to rise under the price comparison effect. Affected by the epidemic situation, natural disasters and locust disasters, the global food and other crops will enter the rising channel in 2020. Not only will 240 million people in Africa be in a state of hunger, but more than 70% of the population in some countries will encounter difficulties in obtaining food. Affected by the locust disaster, the grain production of India, Pakistan and other countries will also be seriously damaged (Indian scholars predict that the locust disaster may reduce India's grain production by 30% - 50%) %On July 13, the world food security and nutrition 2020 released by the five major UN agencies shows that 130 million people will be hungry this year, and 690 million people in the world are starving. In the near future, agricultural products, including rice and corn, have been booming.