Cotton Market Is Difficult To Stabilize, Bottom Up Process Slow

In terms of domestic cotton market, the reduction of cotton planting area in 2012 is beyond doubt.

The total amount of the state's total collection and storage is about 3 million 100 thousand tons. At present, the State Reserve is considering converting imported cotton into reserves, about 4 million tons.

The remaining cotton remains limited in domestic circulation enterprises and textile enterprises. The domestic cotton resources in Xinjiang are about 800 thousand tons, matching and 300 thousand tons of futures warehouse cotton and real estate cotton. In the past few months, commercial imports of cotton were about 1 million tons.

It is estimated that the total domestic cotton supply is 6 million 100 thousand tons, and the demand is measured at 700 thousand tons per month. The consumption of 6 months is 4 million 200 thousand tons, and the supply side is relatively loose.

As for the international cotton market, due to the corresponding changes in the export policy of India cotton, in the next 4-5 months, the imported cotton resources are mainly from the US cotton. In 6-8 months, Australia and Brazil cotton from the southern hemisphere will arrive in Hong Kong. According to the current quotation of cotton, the quota price is about 2500 yuan / ton. The price of Australia cotton is basically the same as that of the domestic cotton spot high-grade cotton, so the price is not dominant.

On the whole, the average quality of imported cotton resources is higher in the months before the new cotton is not listed, and the price level may increase.

From this point of view, it seems to have certain support for domestic cotton prices.

1. Price Bulletin: domestic lint: 129 level 21342 yuan / ton; 229 level 20375 yuan / ton; 328 level 19211 yuan / ton; 428 grade 18401 yuan / ton.

Domestic textiles: polyester staple fiber 10920 yuan / ton; viscose staple fiber 16170 yuan / ton; C32S price 26270 yuan / ton.

2. price structure: the price difference of yarn and cotton C32S-CottonB is 7029 yuan / ton, the difference between cotton and polyester is 8331 yuan / ton, and the difference between inside and outside cotton price is CCindex328-FCindex328 3697 yuan / ton.

3. domestic stock: on the 21 day, domestic cotton spot prices continued to fall.

Domestic and foreign cotton supply is relatively loose, and terminal consumer demand has not been improved. Textile enterprises have high inventory of yarn and cloth and weak purchasing power. The relative price advantage of outer cotton relative to domestic cotton price has further dragged down domestic cotton prices.

4. imported cotton: in May 21st, with the rebound of ICE futures, the price of China's main cotton imports rose in all directions, and most varieties rose by 1.25 cents.

With the stabilization of cotton prices and the issuance of sliding tax, the inquiry and purchase of foreign cotton in textile mills began to become active in recent days.

5.ICE cotton: in May 21st, ICE futures ignored the US dollar index and the sharp rise in US stocks. In July, after the contract opened high, the market crashed, and then it was hit by speculative selling. Cotton prices were supported near the lowest point last Friday. The intervention of the copied chassis has helped cotton prices recover some of the downtrend.

At present, the Zheng cotton 1209 contract has been lower than the current corresponding grade cotton spot price, is already the reverse market, indicating that the market demand for cotton in the future is not optimistic, and the spot price is also gradually deepened.

With the deepening of Zheng cotton's decline, the atmosphere of Zheng cotton began to change quietly.

17, China's Cotton Industry Summit Forum uploaded some positive information. An official said (1) do not question the collection and storage of state policies, but will also open up next year. (2) do not have to worry about the storage capacity; (3) before the new flower listing, the temporary storage will digest part of it.

The state will certainly not throw away its stores in the form of market pressing.

This statement gives confidence to long-term investors in the long contract.

Judging from the recent two days' performance, "empty Ping" and "multi opening" have increased gradually, but in the condition of basic weakness, bulls are not very optimistic about the rebound space.

Although the short line of Zheng cotton is likely to continue, the bottoming process can not be completed in two or three days.