Flame retardant fabric_Flame retardant fabric_Cotton flame retardant fabric_Flame retardant fabric information platform Flame-retardant Fabric News The cotton rebound has come to an abrupt end. What points should we pay attention to in future domestic cotton price fluctuations?

The cotton rebound has come to an abrupt end. What points should we pay attention to in future domestic cotton price fluctuations?

“At this rate of decline, it is estimated that when the new season cotton comes on the market, the opening price of spot seed cotton in the main producing areas will be aroun…

“At this rate of decline, it is estimated that when the new season cotton comes on the market, the opening price of spot seed cotton in the main producing areas will be around 5.5 yuan/kg, and the mainstream price in the market is more likely to be around 5 yuan/kg.” said a family in southern Xinjiang. Mr. Wang, the person in charge of the ginnery, told the Futures Daily reporter that at present, the factors affecting the market price of domestic old cotton and new cotton are complicated. Although the US Department of Agriculture recently announced production reduction data that was very unexpected to the market, it has not affected the domestic cotton price. The effect is limited, and after the speculation on the US cotton production reduction and its return to the downward channel, the domestic cotton price started to fall sharply again in the night trading on August 17. It is expected that before and after the domestic new cotton is launched, the domestic new and old lint cotton mainstream market It is more likely that the price will fall back to the price range of 2019 and 2020.

Liu Chuang, a cotton spot trader in Shangqiu City, Henan Province, told reporters that before August 17, the U.S. cotton market was mainly dominated by dry weather in production areas. The market was highly enthusiastic about the reduction of U.S. cotton production, but since the U.S. Department of Agriculture announced After the production reduction data that completely surprised the market, the “production reduction and rising water market” has also come to an end.

According to statistics, the price of the main U.S. cotton futures contract started from the lowest point of 82.54 cents/pound on July 15. After 23 trading days of oscillation and upward movement, it finally rose to 119.59 cents/pound on August 16. Boosted by the upward trend of US cotton, the price of Zheng cotton’s main futures contract rose from a low of 13,575 yuan/ton on August 5 to a high of 15,790 yuan/ton on August 17.

According to the above-mentioned teacher Wang, future domestic cotton price fluctuations will mainly be affected by the following factors:

First, the current domestic cotton market and the US cotton market are differentiated. Affected by multiple factors, the downstream demand for my country’s cotton is relatively weak, and the export channels to Europe and the United States are not smooth. If energy problems in Europe trigger macro problems such as the European debt crisis this winter, , then various market entities in the domestic cotton industry chain will be impacted again.

Second, there is a lack of purchasers in the domestic cotton market in the new season, and the rush-buying phenomenon that has occurred in past years may not reappear this year. After the baptism of the market in 2021, the production and operation of some ginning plants are in trouble. As of now, there are still many gins that have not been contracted by third parties, and many gins that plan to purchase newly produced seed cotton have stated that they will do so rationally.

Third, new cotton is growing very well, and expectations for increases in unit yield and total output are optimistic. It is estimated that the increase in output will, to a certain extent, make up for the loss of cotton farmers’ income from lower prices. However, for cotton farmers, since the minimum target price of cotton is still implemented in Xinjiang this year, the probability of damage to cotton planting income is not high.

The fourth is how to deal with the large carry-over old cotton inventory. Recently, although the State Reserve has carried out some purchases and storage of cotton, the quantity is small and cannot effectively solve the problem of old cotton inventory. Data released by relevant agencies show that the current social inventory of Chen cotton is about 3 million tons.

Fifth, the inventory of finished products in the downstream cotton industry is large and orders are “light”.

“A few days ago, the U.S. Department of Agriculture released its monthly agricultural supply and demand report for August, in which the estimate of the reduction in U.S. cotton production exceeded market expectations, and U.S. cotton futures prices continued to rise by the limit.” Wu Xinyang, a soft commodity researcher at CITIC Futures, told reporters that in August In the report, the U.S. Department of Agriculture focused on lowering U.S. cotton production. Affected by dry weather, the growth rate of U.S. cotton continues to decline. Therefore, the U.S. Department of Agriculture has adjusted the U.S. cotton planting abandonment rate to 42.86%, the highest value in the past 10 years. The yield has been slightly lowered to 846 pounds/acre, slightly higher than the average level of the past 10 years. The overall U.S. cotton production in 2022/2023 is forecast. The estimate is lowered by 640,000 tons from the July monthly report to 2.74 million tons. Although the August monthly report continues to reduce global cotton consumption in 2022/2023, the rising expectations of production cuts still support the continuous daily limit of US cotton. And such a high price brings obvious negative feedback downstream. The USDA’s sharp reduction in U.S. cotton production for the new season is due to the apparent slow sales of U.S. cotton exports. After the end of the 2021/2022 season, U.S. cotton has been shipped and exported a total of 2.97 million tons, lower than the estimated 3.19 million tons. As important buyers of U.S. cotton, China, Vietnam, Pakistan, Bangladesh and other countries have seen a significant decline in their imports of U.S. cotton in 2021/2022. Although Southeast Asia’s textile production capacity has taken on a lot of cotton textile production orders, the operating rate in Southeast Asia is not the same as that of China. Show the same trend. In the US cotton market, whether such an exaggerated production reduction can be successfully implemented and how the negative feedback caused by high prices will end will be the focus of the future US cotton market game. At the same time, the trend at the consumption level is intensifying. The inventory accumulation of clothing and fabric wholesalers in the United States accelerated in June, with a year-on-year increase of 59.97%. The retail inventory of clothing and clothing accessories in the United States increased by 23.02% year-on-year in May. In summary, the market is in a game between reality and expectations, but until it completely reverses, the entire industry chain may need to shift from passive accumulation to active destocking.

Mr. Zhang, a senior cotton analyst in Ningbo City, Zhejiang Province, told reporters that from the perspective of technical graphics, US cotton futures prices are at a critical point, and the probability of peaking is very high. For example, the neckline of 118 cents/pound is very important. It is both The gap of the breakthrough is also the establishment of the average breaking position, and it is also the support and suppression position for several previous “offenses and defenses”. Futures prices operate in cycles, including rising cycles and falling cycles. There are retracements in rising cycles and rebounds in falling cycles. To identify the cycle, look at the most important support lines and suppression lines, and filter out otherTrade signal. If the US cotton December contract futures price effectively breaks through 118 cents/pound, then “offense” and “defense” will change positions, and the previously judged downward cycle will be questioned. Recently, around the price of 118 cents/pound, the long and short parties have launched a fierce battle, and finally formed the “hanging star at dusk” technical form, which did not break through 118 cents/pound.

Teacher Zhang said that in the long run, he still holds a bearish view because the fundamentals are weak and the early price rebound has not resolved the inherent contradiction. For example, from the perspective of the cotton yarn market, it is true that cotton yarn shipments are currently accelerating, but it may be due to the fact that some textile companies have intermittently started operations to maintain production after the continued high temperature weather in the south, or chose to go out of business directly. The overall operating rate is unstable. At present, different varieties of pure cotton yarn perform differently in the market. Low-count yarn is still the main sales variety in the market. High-count yarn with cotton-cotton yarn is better than Xinjiang cotton-cotton yarn. On the whole, the cotton yarn market situation is not very good, only better than the previous period but weaker than the same period in previous years. Although the price of pure cotton yarn has stopped falling and stabilized, the inventory pressure of textile companies is still very high, and textile companies have a strong willingness to ship.

For the gray fabric market, the textile peak season is approaching, and it will soon be the “Golden Nine and Silver Ten” season, but the estimates of industry insiders are not very optimistic. It is understood that the opening rate in Foshan has improved, at 40% to 50%, and some cheap products can be sold. Judging from the orders, the market is tepid. The downstream textile and apparel industry ultimately has orders for gray fabrics for export. Actual orders are still insufficient, and most orders are in small batches. In the early stage, there were many staking outs, proofing, and price inquiries, but few actual orders were placed. The price competition for large-volume orders was fierce, but the number of subsequent intended orders was insufficient.

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Author: clsrich