Cotton Will Become The "Pioneer" Of The First Rebound In Commodity Prices.

Although the situation of cotton is not optimistic, its positive factors also have two positive advantages.

First, the USDA report on supply and demand is good.

Recently, the US Department of agriculture cut production expectations and cotton prices soared.

According to the US Department of agriculture's global production and demand forecast for August, global cotton inventories in the global 2015/16 decreased by 653 thousand tons.

Two, the pressure on the supply side of the cotton market will be reduced. According to the sampling survey of the main cotton producing counties in thirteen cotton producing provinces in China, the actual planting area of cotton in 2015 is estimated to be 52 million 640 thousand mu, which is 20% lower than that in 2014. The total output of cotton in the whole country is 5 million 500 thousand tons, down 14% from the same period last year.

According to China Customs statistics, in July 2015, China imported 105 thousand and 700 tons of cotton, a decrease of 34.67% compared to the same month. In September 2014 -2015, in July, China imported 1 million 600 thousand and 900 tons of cotton, down 42.80% from the same period last year.

In spite of these positive effects, despite the low innovation of other commodities this week, the main cotton contract trend is still relatively stable, and is ready to seek an upward breakthrough.

Domestic cotton

In recent years, they have been on a downward trend and have been refreshing their historical low for nearly 5 years.

Spot market, the current domestic 3128B real estate cotton market price of 13000 yuan / ton, compared with the highest price in February 2011 30900 yuan / ton fell 57.92%.

Futures market also remained weak, as of yesterday's close, the main contract CF601 fell slightly 45 yuan / ton to 12415 yuan / ton, has been fourth consecutive trading days down.

analyst

Think, lead to

There are three main reasons why prices continue to fall.

First, the high storage pressure is still in store.

In early July of this year, cotton mills began to work, but the turnover was light.

Two, demand side improvement is weak, and textile enterprises are short of funds.

The improvement of downstream consumption is still weak. Recently, textile is still in the off-season, and there are not many orders in autumn.

Yarn factory sales are still not optimistic, inventory pressure is high, tight funds, business has not improved significantly, cotton consumption decreased.

Three, Southeast Asia seized the market and textile exports declined.

In July 2015, China's textile and clothing exports amounted to US $27 billion 254 million, an increase of 7.52%, a year-on-year decrease of 10.19%. In the first half of this year, China's textile and clothing exports decreased by 2.91% over the same period last year.

Liu Xintian, the core expert of China Commodity Development Research Center, predicts that cotton will become the "pioneer" of the first big rebound in commodity decline.

There are three reasons: first, the recent bad profits have been basically digested, while the good ones have not yet been put into force. The coming golden nine silver ten will surely stimulate the latent good of cotton. The two is that this year's El Nino phenomenon may be the strongest one ever recorded. The influence of climatic conditions will lead to the decline of cotton production and the increase of cotton demand. Three, because the cotton price has been hovering at the bottom for a long time, the domestic yarn and imported yarn are beginning to be competitive. From the substitution point of view, the viscose price is beginning to be higher than that of cotton, and it also has a positive effect on cotton demand.