Cotton Market Will Continue To Weaken And The Parties Will Not Dare To Act Rashly.

Domestic spot market 3128B lint price at 15876-16178 yuan / ton, the average price of 16004.57 yuan / ton, compared with the beginning of the week fell 0.04%, cotton prices this week weakness.

As soon as the reserve cotton is coming out, Xinjiang cotton begins to pport to the mainland in large quantities. The market supply is expected to be relatively abundant, and the buyer's market appears, leading to the weakening of the price of the lint market.

The cotton reserves will start soon. Cotton prices will drop after cotton companies are worried about the country's cotton reserves, but most of the textile companies will be ready to sell.

Before going out of the market, purchases are mostly bought and used rather than inventory. The overall strategy is to wait and see more.

In terms of futures, zhengmian 1705 contracts rose sharply this week, especially in February 24th, when the main contract of Zheng cotton closed 1705 yuan 15900 yuan / ton, up 2.38% compared with the previous trading day, up 255 yuan / ton, or 1.63%, compared with last Friday's settlement price of 15645 yuan / ton.

ICE cotton rose this week, especially in February 23rd, after the recent decline in buying and the US dollar fell. The ICE 5 cotton contract rose 0.81%, at 76.10 cents a pound, the largest increase since February 13th.

Overall, Zheng cotton and ICE cotton oscillate upward this week.

As the freight rate rose before the Spring Festival,

The progress of moving library is far slower than in previous years. With the slow down of freight pressure, the move of Xinjiang cotton store has increased recently.

The price of downstream cotton yarn has been rising. According to price monitoring, as of February 24th, the average price of 21S cotton knitted yarn of high quality knitted fabrics was 23775 yuan / ton, up 0.26% from the beginning of the week.

According to a textile enterprise in Shandong, the price of foreign yarn is rising, and domestic cotton yarn production and sales are good at present.

Although the downstream cotton yarn market has an advantage over outer yarns, the market generally believes that the cost of cotton yarn is reduced and the downstream prices are more volatile, and the degree of support for domestic cotton prices is yet to be tested.

Whole

For short term, domestic supply level is relatively abundant.

On the whole, the spot market is running smoothly before the reserve cotton rotation. Although Zheng cotton has a high trend, it is afraid that the foundation is unstable. Cotton futures market is expected to weaken next week.

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Due to the unexpected cotton production in Xinjiang, the US agricultural report raised the cotton output in February to 109 thousand tons, to 4 million 898 thousand tons, while maintaining the consumption of 7 million 892 thousand tons.

Despite the increase in domestic cotton production, the supply gap in the year is still as high as 3 million tons, an increase of 170 thousand tons over the previous year, which is the largest supply gap since the implementation of the temporary storage policy in 2011/12.

According to the statistics of reserve cotton inventory of relevant institutions in China, the 3 year temporary storage and storage plus the former Chen cotton accumulated 17 million 300 thousand tons of cotton, while the total output of cotton in the 2012-2016 years was 9 million 630 thousand tons.

In 2014 and 2016, the turnover volume was larger, with a total of 2 million 396 thousand tons and 2 million 670 thousand tons respectively, with a turnover ratio of 19% and 89% respectively.

The year 2016 is the highest proportion of dumping and storage pactions. The main reasons are as follows: reserve cotton is sold for "batch inspection" and "package inspection". The quality is guaranteed and the worries of enterprises are solved. There is a shortage of circulating resources in the market, and reserve cotton is the main source of market supply.

According to industry estimates, the quality of the reserve cotton sale this year is still guaranteed, and it will be 2 months ahead of schedule last year, and the market supply will be significantly improved compared with the previous year.

However, after 5 years of dumping and storage, only 7 million 670 thousand tons of cotton remaining in the State Reserve will be reduced to 5 million tons (excluding the new annual round of imports) after dumping this year.

In addition, compared to other crops, cotton planting income ratio is not prominent, cotton planting area has declined for 5 consecutive years.

Cotton planting area decreased by 43% in 2007 compared with that of last year.

According to the investigation of the Xinjiang autonomous region development and Reform Commission, the planting area of cotton per household this year is expected to decrease by 2.81% compared with the actual sowing surface last year.

After the reserve cotton inventory has dropped to 5 million tons, the decline of cotton planting area will benefit domestic cotton prices for a long time.

For more information, please pay attention to the world clothing shoes and hats net report.