On Tuesday, cotton and cotton yarn both closed lower, and both hit their lowest level in more than a month. The external market fell as Hurricane Ida eased concerns about crop damage, weakening support for the domestic market. The quality of the domestic “Golden Nine and Silver Ten” is questionable, and expectations of a sluggish peak season are weighing on the market.
ICE cotton futures ended lower overnight as concerns about crop damage eased due to Hurricane Ida . The ICE December cotton contract closed down 0.61 cents, or 0.64%, at a settlement price of 94.23 cents per pound. Hurricane Ida has now weakened to a tropical storm. The market had previously been worried that Hurricane Ida might cause major flooding in much of the southeastern United States. Keith Brown, president of cotton broker Keith Brown and Co., said cotton futures prices fell because Hurricane Ida did not pass through the Christi and Rio Grande Valley areas. Louis Rose, an analyst at Rose Commodity Group, said in a report that we do not believe Hurricane Ida will have a major adverse impact on cotton crops in the Midwest and Southeastern United States.
In the domestic market, the domestic cotton planting area has decreased, and weather disasters occurred in the early stages of cotton planting this year, so cotton production is expected to decline in the new year. But on the demand side, the market has doubts about the quality of the “Golden Nine and Silver Ten”. Huarong Rongda Futures said that the current fundamentals of Zheng Cotton have weakened compared with the previous period, mainly in the downstream market. Since entering August, the overall market of the originally strong yarn end has weakened, mainly in terms of new orders. , according to downstream yarn mills, new orders are scarce, and textile companies are still rushing to make early orders. With the decline in cotton prices, cotton yarn prices are difficult to maintain a strong trend. The overall price center of gravity has shifted downwards, and some textile companies have also experienced A slight accumulation of inventory. The market is not optimistic about the follow-up market amid expectations of macroeconomic tightening and weakening demand. However, overall, the fundamentals of Zheng cotton are acceptable. In the new year, there are expectations of a decline in output and a rush to harvest seed cotton.
Regarding the logical evolution of the disk, Guosen Futures believes that the international market is paying attention to the impact of the weather in the United States, and the hurricane was downgraded to a tropical storm, which had a small impact on cotton, and the price of U.S. cotton fell. Domestic Zheng cotton has been dragged down and prices have also softened. The downstream gold, silver and silver consumption is expected to be of insufficient quality, which will also suppress cotton prices. However, the cost of new flowers is higher and there may be support. Mainly short-term trading. Huatai Futures believes that the market is waiting to wait for the opening of the scale before the new flowers are released. It is expected that cotton prices will still have a certain degree of resilience before the new flowers are released. However, concerns about consumption will make the market face resistance when it hits the market again. The short-term market is expected to be dominated by shocks. . </p
