Recently, the domestic and foreign cotton inventory-to-consumption ratio has declined, U.S. bond yields have risen, A-shares have turned from strong to weak, and the intention to plant new cotton has been erratic. The pace of upstream and downstream transmission in the domestic textile market has slowed down, and factors affecting cotton price trends are complex. Overlay.
According to the February supply and demand report of the United States Department of Agriculture, the total global cotton production in 2020/21 was 24.852 million tons, an increase of 278,000 tons from the previous month and a significant decrease of 1.736 million tons year-on-year; global consumption was 25.519 million tons. , a month-on-month increase of 323,000 tons, a significant increase of 3.179 million tons year-on-year; the global ending inventory was 20.844 million tons, a month-on-month decrease of 127,000 tons, a year-on-year decrease of 694,000 tons. The report data is generally positive. In addition, cotton planting in Brazil is coming to an end in the near future. According to the prediction of the Brazilian Cotton Growers Association, the total cotton planting area in Brazil in 2020/21 will be 1.356 million hectares, a year-on-year decrease of 16%. The yield is expected to decrease by 1.5%, and the output is expected to decrease by 17%. In the early stage, NCC’s intention area in the United States was also expected to decline, but the market still took a wait-and-see attitude towards its actual planting situation, and is currently turning its attention to the cotton planting intention report at the end of this month.
As the U.S. dollar index rises, domestic and foreign futures positions have shrunk significantly, and the downstream textile industry is tepid, with insufficient follow-up on new orders and other issues. Cotton sales have cooled significantly. According to data from the National Cotton Market Monitoring System, in the two weeks of March 1-5 and March 8-12, 2021, cotton processing enterprises across the country sold a total of 190,000 tons and 170,000 tons of new cotton, a 30% decrease from the previous week – 40%, a year-on-year increase of 10%-30%. Between wait-and-see and hesitation, the price of some yarns has been reduced by nearly a thousand yuan per ton, and the price of cotton has fallen rapidly. In the early stage, the integer mark of 16,000 yuan/ton for Zheng cotton was regarded as a strong support level, but now it has become a resistance line.
In the face of factors such as macro-financial inflation, epidemic development, changes in industrial supply and demand, and new cotton planting intentions, factors that restrain the cotton market in the short term are increasing, and it will take time and space to further release. In this context, it is expected that the “Golden Three” peak season may sadly pass away. </p
