China Fabric Factory Fabric News In the face of extreme weather, where will the new cotton price and domestic cotton prices go in the future?

In the face of extreme weather, where will the new cotton price and domestic cotton prices go in the future?



Recently, the spot price of domestic cotton futures has hit record highs repeatedly. The state reserve cotton bidding sales not only have 100% transactions every time, but also the…

Recently, the spot price of domestic cotton futures has hit record highs repeatedly. The state reserve cotton bidding sales not only have 100% transactions every time, but also the transaction price is “sesame blossoming and rising.” What is even more concerning to the market is that in the August monthly supply and demand report released recently, the US Department of Agriculture jointly lowered the cotton production in the United States and the world for 2021/2022. It predicted a decrease in global cotton production, an increase in consumption, and a decrease in ending stocks. Cotton prices at home and abroad have fluctuated rapidly. On this occasion, the websites of some institutions have released news that most areas of Xinjiang have recently experienced rainfall and cooling weather, as well as hail and other strong convective weather in some areas. It is reported that some cotton fields suffered sudden hailstorms, causing cotton bolls to fall off and cotton leaves to be knocked off, which is very detrimental to the increase in cotton production. What is the actual situation? What will be the operating trend of this year’s new cotton price and the domestic cotton price in the future?

Kong Jing, business manager of the second cotton department of Shanghai Textile Investment Trading Co., Ltd., told the Futures Daily reporter that cotton in Xinjiang and the mainland has entered the peak flowering period and is in the process of preparing for production. At the critical growth stage of the foundation, American cotton begins to sprout. Its growth rate and the weather in the production area also have an important impact on the final yield of cotton. At this time, the market has released “numerous” forecast values ​​for domestic and foreign cotton production in the new year. According to the year-round market operation rules, at this time of year, the market will speculate on cotton output and the weather in the producing areas. Due to some special circumstances in the market this year, such as the recurrence of the new coronavirus epidemic, the expansion of ginning production capacity in Xinjiang, the reduction of US cotton production, and the high price of cotton yarn, the trend of domestic and foreign cotton prices is also stronger than in previous years. In some markets People even predict that domestic cotton prices will soon exceed the 20,000 yuan/ton mark.

“In the absence of large-scale disastrous weather in Xinjiang and major international cotton-producing countries, production is just a subject of market speculation. In fact, the annual fluctuations in global cotton production have an important impact on the The final impact on market prices is not large. The reason is that cotton planting area and output at home and abroad are relatively stable, and factors that can cause price fluctuations are often market psychology, demand, etc.” Kong Jing said that from the current domestic cotton growth situation Look, cotton is growing well in Xinjiang and the mainland. Although the planting area has slightly decreased in the new year, the yield per mu is expected to be generally 430-450 kilograms, and the total output will not decline significantly. Judging from the main logic leading this wave of rising domestic cotton prices, first, domestic demand in the off-season is acceptable, and the market has good expectations for the future. Second, the cost of new cotton is expected to be high. The increase in ginners will cause competition for seed cotton resources in the market. The market initially estimates that the cost of lint cotton will be around 18,500 yuan/ton under the high purchase price of seed cotton. Third, the rise in U.S. cotton has become one of the important driving forces for the strengthening of domestic cotton prices. The main logic of the future market is still expected to be positive.

Li Junfeng, a major cotton grower in Alar City, Xinjiang, told reporters that the extreme weather in individual areas of Xinjiang will not affect the overall cotton production, and a bumper cotton harvest is expected in Xinjiang. It is expected that cotton farmers can wait for the cotton harvest after watering and fertilizing for the last time around August 25. It is expected that Xinjiang cotton will start to shed cotton around September 20.

Kong Jing believes that the futures price of Zheng cotton’s main 2201 contract reached a new high of 18,505 yuan/ton in the past three years yesterday, while the US cotton reached a new high of 97.26 cents/pound in the past seven years. Domestic The upward trend in foreign cotton prices seems to be somewhat “unstoppable”. However, judging from the relationship between domestic cotton and cotton yarn and price trends, the differentiation trend is becoming more and more obvious. On July 28 this year, the cotton yarn 2109 contract futures price reached a maximum of 27,520 yuan/ton, and the cotton 2109 contract futures price exceeded 17,625 yuan/ton. The price difference between the two was 9,895 yuan/ton. As of yesterday, the highest futures price of cotton yarn 2109 contract was 26,170 yuan/ton, and the futures price of cotton 2109 contract was 18,265 yuan/ton. The price difference between the two narrowed to 7,905 yuan/ton. Theoretically speaking, the price of cotton yarn should fluctuate with cotton. As a result, after the price of cotton rises, the price of cotton yarn actually falls. From this perspective, the market is not optimistic about the future price of cotton yarn, which means that there will be many difficulties in the downward transmission of high cotton prices in the future. At present, there is still about one and a half months until new cotton is launched in China. Originally, downstream textile companies should have entered the peak season of “Golden September and Silver October”. However, due to the impact of the epidemic and the early entry of foreign orders, the so-called peak season orders have been unusually cold. At the same time, with the linear rise in cotton prices, fewer and fewer people are asking for cotton yarn prices, and the market does not accept the increase in yarn prices. In addition, the weakening of the global economy, the increasing uncertainty of downstream orders, and the expected change in the purchase price of new cotton by ginning companies all make it difficult to “pay” for the market’s willfulness with confidence.

Zhou Wenke, a cotton futures investment professional in Hangzhou, said that the weekly crop growth report released by the U.S. Department of Agriculture on Monday showed that as of the week of August 15 this year, U.S. cotton The growth rate of excellent and good growth was 67%, compared with 65% the previous week and 45% in the same period last year. Judging from the growth of U.S. cotton, there may still be variables in future production. It is unpredictable how the USDA will adjust production, consumption and ending stocks in the future. What’s more, the current domestic and foreign cotton prices have reached high levels, and downstream demandWhen there is no major profit, it is not appropriate to chase the long position at this time. It is also understood that due to the rapid rise in cotton prices, textile companies have to increase cotton yarn prices, but downstream stocking willingness is not active, and price transmission has been poor. For example, some gray fabric manufacturers have slowed down their purchasing pace. The falling prices of viscose, polyester staple fiber, etc. have made their cost-effectiveness continue to improve, and alternatives to cotton yarn are emerging in the market.

Downstream procurement and consumption are weak, and the weather has limited impact on Xinjiang cotton production, which seems to be reflected on the market. Yesterday night, cotton and cotton yarn futures both fell, with the main 2201 contract closing down 1.31% and 1.36% respectively.

</p

This article is from the Internet, does not represent 【www.factory-fabric.com】 position, reproduced please specify the source.https://www.factory-fabric.com/archives/17148

Author: clsrich

 
TOP
Home
News
Product
Application
Search