Recently, the fluctuation range of Zheng Cotton has decreased significantly. It used to fluctuate by hundreds of points every day, but now it is gradually returning to a normal rhythm, mainly because there are fewer hot spots for speculation. How the cotton market will go in the future may really have to wait until new cotton comes on the market.
The early rebound in the cotton market is mainly related to three reasons. First, the Fed’s expectations of vigorous interest rate hikes have eased; second, foreign production areas have suffered from drought, and production cuts are expected to be strong; third, the “Golden September and Silver Ten” sales season is approaching, and the market expects consumption to bottom out. .
Now looking at these three conditions that are expected to support the rise, the bullish effect is declining. Last Friday, Federal Reserve Chairman Powell made tough remarks on raising interest rates during the annual meeting of global central banks in Jackson Hole: “Stressing that tightening policy will be maintained until inflation is completely resolved.” That night, U.S. stocks fell sharply and the U.S. dollar rose sharply, indicating that the capital market was very afraid of raising interest rates.
Last week, the cotton areas of the United States also received widespread rainfall, which effectively alleviated the impact of drought on cotton production. Among them, there were large-scale thunderstorms in the southern part of the southeastern United States, with rainfall ranging from 50 to 125 mm; there were showers in the northern delta area, which is expected to promote the ripening of cotton bolls. The boll weight is increased and the yield is expected to be normal; there will be widespread rainfall in western Texas, with the maximum rainfall being 75-90 mm. The U.S. cotton production report released by the U.S. Department of Agriculture on August 29 showed that 34% of U.S. cotton growth conditions were good or above, an increase of 3 percentage points from the previous week.
According to the forecast of the National Cotton Market Monitoring System, as of August 25, the cumulative sales of lint cotton nationwide were 3.989 million tons, a year-on-year decrease of 1.945 million tons, and a decrease of 1.626 million tons compared with the average of the past four years, of which Xinjiang sales were 3.479 million tons, a year-on-year decrease of 1.760 million tons. , a decrease of 1.304 million tons compared with the average of the past four years. At present, cotton sales in Xinjiang are slow and there is still a large amount of inventory for sale. With expectations of a bumper cotton harvest in the new season and a large amount of carryover inventory, the cotton market will continue to be under pressure.
The above expectations have been reflected in the market. Now the market is waiting for the opening price of new cotton. The cost price of cotton in the new year will play an important guiding role in the future cotton price trend. At present, manual picking has begun in early-maturing cotton areas, and the company’s opening price has been tentatively set at 6.0 yuan/kg. This price has little significance in guiding the market. The cost of Xinjiang cotton can only be finally determined when a large amount of new cotton is launched and purchased. . Therefore, the short-term cotton market will continue to fluctuate.