Although Zheng cotton has fallen back from its high level recently, from the perspective of technology and market sentiment, the CF2201 contract has strong support at the 17,700 yuan/ton mark. Suppressed by the pullbacks of both ICE and Zheng Cotton, the basis quotation and fixed price of domestic cotton spot prices dropped by 500-800 yuan/ton. However, the quotation of cotton yarn stabilized at a high level, and the atmosphere of waiting and watching was strong, and the margin of preferential profit margin was limited.
Why are the cotton yarn quotations of textile companies and traders unwilling to follow the price reduction of Zheng cotton and Zheng yarn? The views in the industry can be roughly summarized as follows: First, although domestic cotton spinning enterprises have accumulated cotton yarn inventories, they have not reached the warning line. In addition, capital flows are relatively abundant and risks are controllable; second, downstream orders are smooth, and the short-term operating rate continues to be at a low level. High, the demand for cotton yarn remains high; third, since mid-August, Zheng Mian has stepped out of the “roller coaster” market and frequently adjusted cotton yarn quotations, which is not conducive to the fulfillment of early orders, nor is it conducive to receiving orders in the fourth quarter of 2021, which can easily lead to customer loss Fourth, the “Golden Nine and Silver Ten” period in the domestic sales market is approaching, and orders for the spring and summer of 2022 are expected to be placed in batches in the near future. </p
