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Cotton Is Still Hard To Get Rid Of In The Short Term.

2011/5/9 9:38:00 63

Cotton Market Enterprises

Since April, the new year's cotton planting in the world is expected to increase significantly and downstream. market The demand for cotton is lower than that of the national control measures. The cotton price fluctuates from 195 cents / pound to 145 cents / pound. The cotton price center of zhengmian main contract has been moved from 30000 yuan / ton to 24200 yuan / ton, and the cotton price in the domestic spot market has also been reduced to 30000 yuan / ton from 7 yuan in the recent 7 times. The downstream demand is hard to recover, and the increase in inventory pressure is the main reason for the recent decline in the cotton market. cotton It will maintain a weak pattern.


  The inventory level of spinning enterprises is relatively high, and the enthusiasm of raw material purchase is low.


April China cotton industry inventory survey report shows that Textile enterprises The yarn sales rate decreased by 8.8 percentage points, the lowest level since September 2008, and the stock chain increased by 13.1 days, the highest level since March 2009. The sales rate of the cloth decreased by 1.4 percentage points, and the stock chain increased by 8.8 days, the highest level since March 2010. In the early April, the proportion of enterprises preparing raw materials was reduced by 8 percentage points, and the proportion of wait-and-see enterprises increased by 10 percentage points.


  Dollar low rebounded strongly, international commodity pressure


On May 5th, Tyse, the European central bank governor, said the ECB would "closely monitor" the upward risk of inflation, suggesting that it might not be able to raise interest rates again until June. This means that the ECB is still determined to maintain the 1.25% interest rate unchanged, triggering the weakening of the euro and strengthening the US dollar index. Crude oil fell sharply by 8% over the past week, triggering investors' worries about the global economic slowdown, and the market panic has made this worry spread, and further released the short term energy of the futures market.


  The weather is bad at home and abroad, but the output of new flowers is still unknown.


In May 1st, a hail struck about 300000 acres of crops in the Shihezi reclamation area of the eight agricultural division, of which 100 thousand acres of newly sprouting cotton were severely damaged. At present, the eight agricultural division of Shihezi has organized relief workers to replant affected crops.


Recently, the drought in Texas, the largest cotton producer in the United States, is also concerned by the market. At present, 85% of Dezhou is affected by drought. The weather forecast shows that there is no precipitation in the near future and drought will continue. In the past winter and early spring, the area was also very dry. Also worrying is the South Texas region. The sowing in the northern part of the area has ended, but 30% of the land is unable to sow because of drought. Some cotton fields have been abandoned in the Grande Valley and the southern coastal areas. If the situation is not alleviated, the area of abandoned cultivation will increase.


  Cotton harvest in the southern hemisphere, US cotton exports contracted down continuously


According to the US Department of agriculture (USDA) released in May 5th the US cotton export weekly, from April 22nd to April 28th this week, net signing volume is still negative, the United States cotton net signed sales of -1415 tons. The net signing volume has been negative for weeks, which is related to China's cancellation of large import orders and the cotton harvest in Brazil and Australia in the southern hemisphere. It is reported that the Cotton Advisory Committee of Brazil (CONAB) has recently predicted that cotton production in 2010/2011 will be 2 million 27 thousand and 600 tons, an increase of 77 thousand and 400 tons from last month, an increase of 69.8% over the year of 2009/2010. The Brazil cotton Exporters Association (ANEA) forecast a 1 million 990 thousand ton. According to the forecast, the output of cotton in Brazil will reach about 2 million tons and will be the fourth largest cotton producing country in the world. Queensland, Australia's main cotton producing area, has been worried about Australia's cotton output despite encountering 50 years of heavy rainfall. The market is expected to cause losses of 100 thousand tons, and the total output may be less than 800 thousand tons. After the weather improved, cotton affected area was limited, the industry generally expected production remained at more than 800 thousand tons. The US cotton export contract volume is negative, the southern hemisphere cotton production increase, to a certain extent, has suppressed the international cotton price.


   RMB appreciation and rising cost lead to textile order transfer


Because of the appreciation of the RMB in recent years, coupled with the rapid rise in domestic labor costs, producers prefer to supply more to the local market, while exports to developed countries such as Europe and the United States have been significantly reduced. Purchasers in many countries believe that the wages of Chinese workers will rise sharply in the future, and production capacity is bound to be compressed. From the end of last year, there has been a delay in supply. Many manufacturers have to place orders a year in advance to ensure supply. Many foreign textile companies are ready to get rid of their dependence on China and move part of their production to the Baltic States or Romania, Bulgaria, Turkey, and even India and Vietnam, Bangladesh and other countries. The transfer of orders made textile enterprises' demand for cotton significantly reduced. The national cotton market monitoring system reduced domestic cotton consumption in 2010/2011 in the March supply and demand balance sheet, and the high cotton prices also dropped sharply.


The high cotton prices in the early stage were largely retraced under the influence of many bad factors at home and abroad. It is expected that cotton will remain vulnerable in the later stage. Investors should pay attention to the weather changes in the main cotton producing areas and the overall trend of the US dollar index and international bulk commodities.

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