Since April, affected by the expected increase in cotton planting in the new global year, low demand in the downstream market, and national regulatory measures, domestic and foreign cotton prices have fallen sharply, and the ICE main contract cotton price has shifted from 195 cents/lb to 145. In cents/lb, the cotton price of the Zheng cotton main contract was shifted from 30,000 yuan/tonne to 24,200 yuan/tonne. The domestic spot market cotton price was also recently lowered by 30,000 yuan/ton in 7 consecutive price cuts for large domestic companies. To 24000 yuan / ton. Downstream demand is difficult to recover. Increased inventory pressure is the main reason for the recent sharp drop in the cotton market. It is expected that cotton will remain weak in the future.
Higher level of inventory of textile companies and low procurement enthusiasm for raw materials In April, the “China Cotton Industry Inventory Report†showed that the yarn sales rate of textile enterprises decreased by 8.8 percentage points month-on-month, the lowest level since September 2008, and the inventory chain increased by 13.1 days. The highest level since March 2009; the sales rate of fabrics decreased by 1.4 percentage points month-on-month, and the inventory increased by 8.8 days from the previous quarter, the highest level since March 2010. In the beginning of April, the proportion of companies preparing raw materials for purchasing decreased by 8 percentage points; the proportion of companies with a wait-and-see attitude increased by 10 percentage points.
The dollar’s ​​low position rebounds strongly and international commodities are under pressure. On May 5th, European Central Bank President Jean-Claude Trichet stated that the ECB will “very closely†monitor the upward risk of inflation, implying that the bank may not be able to re-emerge until after June. Raise interest rates. This means that the European Central Bank is still determined to maintain the interest rate unchanged at 1.25%, which has caused the weakening of the euro and the stronger US dollar index. Commodity prices fell sharply. Crude oil fell by 8% overnight, triggering investors' concerns about the global economic slowdown, and market panic caused this concern to continue to spread, further releasing short-term market energy.
With poor weather at home and abroad, new flower production is still unknown. On May 1, a hailstorm struck more than 300,000 mu of crops in the Shihezi area of ​​the Nongba division, of which 100,000 mu of newly emerged cotton was seriously affected. At present, the Agricultural Eighth Division Shihezi City has organized disaster relief personnel to replant the affected crops.
The drought in Texas, the largest cotton-producing state in the United States, has also received market attention. At present, 85% of Texas is affected by drought. The weather forecast shows that there is still no precipitation in the near future and the drought will continue. In the past winter and early spring the area is also very dry. Equally worrying is the South Texas area. Sowing in the northern part of the area has ended, but 30% of the land cannot be sown due to drought. Some cotton fields have been abandoned in the Grande Valley and southern coastal areas. If the situation is not relieved, the abandonment area will increase.
Hemisphere cotton harvest, US cotton export contract continued to decline According to the United States Department of Agriculture (USDA) released on May 5 US Cotton Export Weekly, April 22 - April 28 week, the net contract volume is still negative, the United States upland cotton Net contracted sales were -1415 tons. The net signing contract has been negative for several consecutive weeks, which is related to China's cancellation of large import orders and the hectic harvest of Brazil and Australia in the southern hemisphere this year. It is reported that the Brazilian Cotton Advisory Committee (CONAB) recently forecast 2010/2011 annual cotton production of 2.0276 million tons, an increase of 77,400 tons from the previous month, an increase of 69.8% over the 2009/2010 output. The Brazilian Cotton Exporters Association (ANEA) is forecast at 1.99 million tons. According to forecast, Brazil's cotton production will reach the level of about 2 million tons, and it will jump to become the fourth largest cotton country in the world. Although Queensland, the main cotton producing area in Australia, experienced heavy rainfall in 50 years, it caused concerns about the production of Australian cotton. The market was expected to cause a loss of 100,000 tons, and the total output may not reach 800,000 tons. Since the weather improved, the cotton area was affected to a limited extent, and it is generally expected in the industry that the output will remain at 800,000 tons or more. The contract volume of US cotton exports was negative, and the production of cotton in the southern hemisphere increased to a certain extent, suppressing international cotton prices.
*** Appreciation of Appreciation of Appreciation of Costs and Increased Costs Lead to the Transfer of Textile Orders Due to the continuous appreciation in recent years, coupled with the rapid increase in domestic labor costs, manufacturers prefer to supply more goods to the local market and export to developed countries such as Europe and the United States. obviously decrease. Buyers in many countries all believe that the wages of Chinese workers will increase significantly in the future, and production capacity will inevitably be squeezed. Since late last year, there have been delays in the supply of manufacturers. In order to guarantee supply, many manufacturers must now place orders one year in advance. Many foreign textile companies are prepared to get rid of their dependence on China and plan to transfer some of their production to the Baltic countries or Romania, Bulgaria, Turkey, and even India, Vietnam, and Bangladesh. The transfer of orders has led to a significant reduction in the demand for cotton used by textile companies. The national cotton market monitoring system has reduced the domestic cotton consumption in 2010/2011 in the supply and demand balance in March, and the high cotton prices have also fallen sharply.
The high cotton prices in the previous period were significantly retraced under the influence of many negative factors at home and abroad. It is expected that the cotton will remain in a weak pattern in the later period. Investors must pay attention to the global changes in the main cotton producing areas and the overall trend of the US dollar index and international bulk commodities.
Higher level of inventory of textile companies and low procurement enthusiasm for raw materials In April, the “China Cotton Industry Inventory Report†showed that the yarn sales rate of textile enterprises decreased by 8.8 percentage points month-on-month, the lowest level since September 2008, and the inventory chain increased by 13.1 days. The highest level since March 2009; the sales rate of fabrics decreased by 1.4 percentage points month-on-month, and the inventory increased by 8.8 days from the previous quarter, the highest level since March 2010. In the beginning of April, the proportion of companies preparing raw materials for purchasing decreased by 8 percentage points; the proportion of companies with a wait-and-see attitude increased by 10 percentage points.
The dollar’s ​​low position rebounds strongly and international commodities are under pressure. On May 5th, European Central Bank President Jean-Claude Trichet stated that the ECB will “very closely†monitor the upward risk of inflation, implying that the bank may not be able to re-emerge until after June. Raise interest rates. This means that the European Central Bank is still determined to maintain the interest rate unchanged at 1.25%, which has caused the weakening of the euro and the stronger US dollar index. Commodity prices fell sharply. Crude oil fell by 8% overnight, triggering investors' concerns about the global economic slowdown, and market panic caused this concern to continue to spread, further releasing short-term market energy.
With poor weather at home and abroad, new flower production is still unknown. On May 1, a hailstorm struck more than 300,000 mu of crops in the Shihezi area of ​​the Nongba division, of which 100,000 mu of newly emerged cotton was seriously affected. At present, the Agricultural Eighth Division Shihezi City has organized disaster relief personnel to replant the affected crops.
The drought in Texas, the largest cotton-producing state in the United States, has also received market attention. At present, 85% of Texas is affected by drought. The weather forecast shows that there is still no precipitation in the near future and the drought will continue. In the past winter and early spring the area is also very dry. Equally worrying is the South Texas area. Sowing in the northern part of the area has ended, but 30% of the land cannot be sown due to drought. Some cotton fields have been abandoned in the Grande Valley and southern coastal areas. If the situation is not relieved, the abandonment area will increase.
Hemisphere cotton harvest, US cotton export contract continued to decline According to the United States Department of Agriculture (USDA) released on May 5 US Cotton Export Weekly, April 22 - April 28 week, the net contract volume is still negative, the United States upland cotton Net contracted sales were -1415 tons. The net signing contract has been negative for several consecutive weeks, which is related to China's cancellation of large import orders and the hectic harvest of Brazil and Australia in the southern hemisphere this year. It is reported that the Brazilian Cotton Advisory Committee (CONAB) recently forecast 2010/2011 annual cotton production of 2.0276 million tons, an increase of 77,400 tons from the previous month, an increase of 69.8% over the 2009/2010 output. The Brazilian Cotton Exporters Association (ANEA) is forecast at 1.99 million tons. According to forecast, Brazil's cotton production will reach the level of about 2 million tons, and it will jump to become the fourth largest cotton country in the world. Although Queensland, the main cotton producing area in Australia, experienced heavy rainfall in 50 years, it caused concerns about the production of Australian cotton. The market was expected to cause a loss of 100,000 tons, and the total output may not reach 800,000 tons. Since the weather improved, the cotton area was affected to a limited extent, and it is generally expected in the industry that the output will remain at 800,000 tons or more. The contract volume of US cotton exports was negative, and the production of cotton in the southern hemisphere increased to a certain extent, suppressing international cotton prices.
*** Appreciation of Appreciation of Appreciation of Costs and Increased Costs Lead to the Transfer of Textile Orders Due to the continuous appreciation in recent years, coupled with the rapid increase in domestic labor costs, manufacturers prefer to supply more goods to the local market and export to developed countries such as Europe and the United States. obviously decrease. Buyers in many countries all believe that the wages of Chinese workers will increase significantly in the future, and production capacity will inevitably be squeezed. Since late last year, there have been delays in the supply of manufacturers. In order to guarantee supply, many manufacturers must now place orders one year in advance. Many foreign textile companies are prepared to get rid of their dependence on China and plan to transfer some of their production to the Baltic countries or Romania, Bulgaria, Turkey, and even India, Vietnam, and Bangladesh. The transfer of orders has led to a significant reduction in the demand for cotton used by textile companies. The national cotton market monitoring system has reduced the domestic cotton consumption in 2010/2011 in the supply and demand balance in March, and the high cotton prices have also fallen sharply.
The high cotton prices in the previous period were significantly retraced under the influence of many negative factors at home and abroad. It is expected that the cotton will remain in a weak pattern in the later period. Investors must pay attention to the global changes in the main cotton producing areas and the overall trend of the US dollar index and international bulk commodities.
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