Maintain Adequate Inventory Before New Cotton Is Listed In Large Quantities.

Epicycle

The storage will end on the last working day of September. It is estimated that domestic cotton will be launched in the middle and late October.

There is a vacuum supply period between the end of the dumping and the new cotton listing, that is, the supply of cotton in China is very small during this period, and the price of the new cotton goes higher after the listing of the new cotton, resulting in a 100% rise in the cotton turnover rate.

Compared with the price of new cotton, the reserve cotton price has more advantages. Downstream enterprises tend to stock up with reserve cotton, and maintain adequate inventory before the new cotton is listed in large quantities.

Last week, the China Cotton Association held its three Executive Council and the national cotton situation analysis conference in Beijing. The National Meteorological Center predicted that the total output of cotton will be 5 million 96 thousand tons this year, a decrease of 9.1%. The national cotton market monitoring system is the latest growth trend, and the total output of cotton is expected to be 4 million 916 thousand tons this year, a decrease of 5.7% compared to the same period last year.

Both domestic and foreign forecasts show that domestic cotton output has declined this year.

According to the latest report of the US agricultural report, 4 million 570 thousand tons of cotton output and 7 million 620 thousand tons of consumption were produced this year. The gap between domestic production and demand reached 3 million tons in the year, which is 16.7% higher than that in the previous year.

Although there are a large number of national cotton stores in China, this part of cotton can often be freely circulated, and the supply is limited.

In terms of the huge supply and demand gap in China,

There is an upward motive.

At this stage, reserve cotton is basically the main source of domestic cotton supply. After the end of September, the domestic cotton supply will have a vacuum before the new cotton market.

In view of the above reasons, the cotton price of new cotton has been running at a high level after the listing of the new cotton company.

This round of cotton rebounding is mainly driven by supply and demand side. As mentioned above, there is a big gap in domestic cotton supply and demand this year, and the gap has increased significantly compared with the previous year, so that domestic cotton prices will rebound sharply. No! There are still many bad factors to suppress, and domestic cotton price elasticity is limited.

There are mainly reasons for the following prices: from a global perspective, the operation range of domestic cotton prices is in line with international cotton prices.

As a backup guarantee, the market supply will increase and the supply of goods will be loose after a new round of dumping and storage. From the perspective of hedging, with the rising price of futures, once there are enough hedging profits, there will be a large number of hedging units entering the market.

The rapid rebound of cotton in the current round, besides the supply and demand factors of the fundamentals, is no lack of promotion.

In the old year, the reserve cotton will be closed at the end of September, and the new cotton list will be ready to start after mid October and cotton prices in September.

At that time, the price of the main 01 contract was below 14000 yuan / ton, the price was lower, and the funds were much more secure.

In addition, the market is expecting higher prices for new cotton, and the rise in cotton prices is almost the consensus of the market.

In the medium term, as mentioned above, domestic and foreign spreads, centralized supply, capital side and hedging disk are suppressed, and the cotton price rise in the late period is also limited and there is a high inflation expectation.