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Cotton City: There Is No Possibility Of A Significant Rise In Cotton In The Future.

2011/10/25 15:49:00 27

Zheng cotton main contract 1201 after the rebound in August, September with the bulk.

commodity

The overall decline is down again, and the current price has fallen to about 19800 of the closing price.

Zheng cotton's fluctuation range is limited, and narrow amplitude oscillation is the main theme.

The weakness of European and American economies will seriously affect domestic exports, which is reflected in the terminal demand. The Canton Fair has always been a barometer of domestic demand for foreign trade. It is understood that the number of people entering the Canton Fair on the first day of this year is 20% lower than that of last year, and the orders from Europe and the United States have also decreased significantly, indicating that the demand for foreign trade is not optimistic.

The demand for foreign trade is weak and domestic

inflation

Despite the fact that monetary policy is still difficult to move in the short term, commodities still do not see the prospect of a big reversal.

This year's cotton production is a big backdrop. If the year of high yield meets the favorable environment of the economic boom, there will not be much restriction on the market in the overall bull market atmosphere, but if the supply is loose and the demand is weak, the pressure of the fall will be greater.

After a slight improvement in demand in September, the demand for yarn began to slump again in October.

increase

The cotton mill reflects that the downstream orders are scarce, and the cloth factories purchase on demand, and it is more difficult to return the funds after sale.

In the case of bad sales, the cotton mill is also on demand, and the general stock will not exceed 15 days. On the choice of varieties, it is inclined to use the outer cotton. The Shankar6M grade cotton in India is currently only about 18000 yuan / ton, and some cotton mills have procured cotton with a cost of 18000 to 19000 in the early stage.

At present, the price advantage of cotton is obvious.

In the middle of October, the new cotton market should have entered the peak period, but the actual situation is that the cotton ginning factory is unwilling to purchase, and the farmers are reluctant to sell because of the low price.

Data show that the current domestic picking rate has exceeded 60%, but

Buy

The rate is still less than 30%. The reason behind this dilemma is that although the purchase price of seed cotton has now dropped to around 4.2 - 4.3 yuan / kg, the cost of lint is still more than 19000, higher than most of the cotton prices, and textile mills' purchasing intention is low.

Storage has become the main sales channel for new cotton, but after eliminating the cost of capital and taxes, most of the domestic storage is still unprofitable.

Seed cotton prices further slide 0.1 - 0.3 yuan will break the stalemate, the profit margin of the storage will be opened after storage, and some of the cotton will enter the national reserve. The pressure of increasing production will be partially eliminated, and the downward pressure on cotton will be eased.

On the one hand, the decline of Zheng cotton will not be too big or too deep.

futures

And arbitrage space will be opened, so Zheng cotton basically does not have the risk of plunging, the 19000 point is basically the limit position.

On the other hand, high yield, low downstream demand and tight financial constraints restrict the possibility of a sharp rise in cotton prices. The total will be around the 19800 oscillation of the purchase and storage price.