Cotton Futures Market Is Encountering "Late Spring Cold".

At present, the cotton futures market is encountering "late spring cold", and ICE cotton price has fallen continuously and hit a new low.

Affected by the global stock market crash and the fall in commodity prices, the price of cotton spot market has dropped along with the news that the reserve cotton is out of stock.

Cotton enterprises are eager to sell new cotton, hoping to rush out of stock before coming out of the market.

At present,

Basically, they have already started production, but the market has not yet started in the early stage of opening.

The intention of downstream customers to enter the market is not strong, and the participation of traders is lower than in previous years.

There is still a possibility of continued decline. Textile companies are mostly waiting for raw materials to purchase.

The factors leading to the decline in Zheng cotton futures prices are more complicated. There are three main reasons for the analysis of the industry. First, the current market is very concerned about how to store the national cotton reserves.

Will further reduce cotton prices, which is also the main reason for the recent decline in domestic cotton prices; two, the domestic and foreign economic growth prospects are still not optimistic, the demand for cotton downstream products is sluggish, and the international cotton prices continue to decline to a greater impact on the domestic cotton market; three, the domestic textile industry is in the pition period, the reduction of enterprise orders, the lack of willingness to purchase cotton, and some factory relocation, affecting the growth of cotton demand.

At present, there are great differences in the price trend of domestic cotton in the late stage.

Although some futures analysts are still looking at the price of cotton, but because domestic cotton prices have been in line with the cost of imported cotton, and domestic cotton planting area is expected to continue to decline, many cotton enterprises think cotton prices are close to the bottom.

Wei Gangmin, chairman of Henan TongZhou Cotton Industry Co., Ltd., said: "investors who may be concerned about the fluctuation of cotton prices have seen the current situation. At present, cotton prices have fallen below 10000 yuan / ton from 13000 yuan / ton in the beginning of the year, and the overall trend is still falling rapidly, and the fall process has not yet been completed."

He said that the sluggish economic recovery and the national reserve cotton throwing and storage still dominated cotton prices. Cotton prices remained unoptimistic before the implementation of the policy of dumping and storage. The real turning point would come from the implementation of the policy of dumping and storage.

Merchants futures researcher also said that the low price of the national reserve cotton will be a big probability event, and cotton prices still have room to fall.

The United States Department of Agriculture recently released the next year's global cotton market forecast report also shows that 2016/2017 global consumption growth is weak, low chemical fiber prices and China's national cotton store plan will bring continuous pressure on international cotton prices.

The USDA report thinks that because China's cotton production and demand gap has increased, and the price of rumoured rounds will be reduced, the number of Chinese reserve cotton throwing and storing in 2016/2017 may increase.