Cotton City Daily
Zheng cotton futures
Boosted by technical buying and the grain market, OVERNIGHT ICE
Cotton is stronger, new domestic cotton is about to be listed, and supply pressure suppresses the height of cotton prices. On August 25, Zheng Mian's shock weakened and broke through 15,000,
Cf2301 contract opened at 15045 yuan, the highest 15140 yuan, slightly increased the position downward, the lowest 14885 yuan, closed at 14930 yuan, down 95
Yuan. The domestic fundamentals are weak, the market is waiting for new cotton to open the scale, the spot to the warehouse is slow, the downstream cotton yarn market is flat, maintaining weak transactions, the willingness of spinning enterprises to go to the warehouse is strong, and the follow-up orders have not improved significantly. Overall, the domestic fundamentals are weak, waiting for the new cotton scale and downstream demand to improve, the wait-and-see mood is strong, it is expected that Zheng Mian will maintain a low level of shock, maintain a wait-and-see.
New York futures prices
On August 24, the October contract rose 131 points at 117.57 cents; the December contract rose 114.07 cents, up 184 points; and the volume was 16068 lots, a decrease of 2144 lots. After a series of corrections, the technical graph of ICE futures remains solid, driven by technical buying and rising grain markets, ICE cotton futures recovered the ground lost the day before, continuing to maintain a sideways and firm trend. In the short term, the U.S. cotton supply problem will continue to provide support, but a severe setback in demand will dampen the impulse to rise in cotton prices, which are not far from the top, and pay attention to tonight's U.S. cotton export weekly report.
Cotton City News
Cotton price tracking
On August 25, the average price of imported cotton arriving at Hong Kong (M index) was 135.06 cents / lb, up 1.85 cents / lb from the 24th, discounting 1% of the import cost (excluding port miscellaneous fees) of 22115 yuan / ton, and the import cost of the discount quasi-tax (excluding port miscellaneous fees) was 22201 yuan / ton; The average price of 3128 cotton in China (B index) is 15990 yuan / ton, which is flat compared with the 24th; Xinjiang cotton Shandong to the factory price of 3128B class 16130 yuan / ton, flat compared with the 24th. The national cotton basis index CNCottonJ (CF2209) was 709 yuan / ton, up 7 yuan / ton from the 24th.
Cotton City News
Domestic cotton market
Recently, there has been rain and cooling weather in Tumshuk City, Xinjiang, which has had a certain impact on local cotton spitting. In late August, the Municipal Development and Reform Commission, the Bureau of Statistics and other departments organized personnel from relevant departments of various regimental farms to measure cotton production in 2022.
Up to now, the number of cotton branches with good local growth is 7-8 per plant, about 15 buds, and 10 bells, accounting for 70% of this kind of cotton; The number of cotton branches with average growth is 6-8, the number of buds is about 15, and the number of bells is 8-10, accounting for 20%; The number of slower cotton branches is about 5, the number of buds is about 10, and the number of bells is 5-6, and the expected output is about 380 kg, accounting for 10%. Among them, these 10% of the cotton fields are basically saline and sandy land reclaimed from the edge of the desert, due to serious soil erosion, it is expected that cotton production has been 350-380 kg / mu.
According to the feedback of cotton spinning enterprises in Henan, Shandong and other places, although the contracts of Zheng cotton yarn futures have continued to oscillate and rebound since mid-August, and the Zheng cotton CF2301 contract has also rebounded from 14150 yuan / ton to 15790 yuan / ton, the growth rate of cotton yarn spot is not large, which is significantly weaker than Zheng cotton yarn CY2209, and it is also lower than the cotton futures market. Most of the spinning mills, light spinning market cotton yarn traders cotton yarn upward adjustment space of only 300-500 yuan / ton (a small number of spinning mills due to the low cotton yarn accumulation rate, high raw material costs and increased by 600-800 yuan / ton), cotton spinning mill "paper" profit decline is more obvious, spinning mills in the inventory to revitalize funds and quotations between the difficult choice.
Judging from the survey, a large proportion of the Sero spinning mills in recent days do not make external quotations, and the mentality of spinning mills and traders holding goods and selling is strong; The quotation of 50S and above high-branch combed/combed cotton yarn is still in the clouds, due to the lack of order support and the high price of long-staple cotton, resulting in low profits and risks of spinning high yarn, most of the spinning mills refuse orders or "order spinning", and do not take the initiative to increase inventory.
Why has Zheng cotton yarn rebounded sharply in the past half a month, leading cotton, polyester staple fiber, viscose staple fiber and other raw materials? There are three main points in the industry analysis:
First, the cotton yarn period in July/August is now upside down to 2500-3000 yuan / ton, both the market and technical aspects need to be repaired, triggering funds into the market to read the bottom; Second, due to the multi-point flowering and rapid spread of the domestic epidemic, coupled with the upgrading of production restrictions and power rations in some parts of East China, Central China, Sichuan and other regions, some cotton spinning mills have been greatly affected by raw material replenishment, cotton yarn production and marketing, etc., the operating rate has continued to decline, and the short-term supply of funds and multi-head speculation cotton yarn is insufficient; Third, since June, the import volume of cotton yarn has fallen sharply (mainly affected by the excessive inversion of internal and external cotton yarn and the small color of the new single traceability), and the domestic cotton yarn has ushered in the opportunity to seize the territory.
According to statistics, the import volume of cotton yarn imported from the mainland in June was about 100,000 tons, down about 34.3% year-on-year; In July, the import volume of cotton yarn was about 70,000 tons, down 63.3% year-on-year. Of course, market feedback, the recent coastal areas of cotton yarn, blank cloth orders have improved, but also support zheng cotton yarn oscillation upward.
International Cotton City
According to a report by Foreign Power on August 22, the first batch of new cotton in 2022 in the Parva region of Hayana State in northern India has been picked, much earlier than the normal situation of October 1, and the price of seed cotton has also doubled year-on-year. Seed cotton is expected to be marketed in other parts of Hayana and Punjab in the first week of September.
According to local sources in India, there have been new cotton listings in and around Pavar since last week, but the current daily listing volume does not exceed 500 packs (170 kg). Traders said the price of new cotton is expected at Rs 9,900-10,000 per quintal. Last year, the price of Indian seed cotton was around Rs 5,000 per quintal. At present, local ginneries in India are anxiously waiting for the new cotton harvest, because the market of cotton in the previous year has ended.
According to local sources, the current new cotton has not been affected by adverse weather, the northern region of the new cotton market early because the region cotton planted earlier, is expected to be in Rajasthan and southern India seed cotton market will start in the first week of October.
According to foreign news reports, Brazil is currently suffering from extreme heat and drought, and cotton yields are expected to decline by nearly 30%. According to the Brazilian Cotton Farmers Association, the drought has led to a 200,000-tonne reduction in Brazil's cotton production forecast in 2022. As the cotton harvest draws to a close, the final production is expected to be around 2.6 million tonnes, or even lower.
According to feedback from some growing areas, cotton yields have fallen by 27%. The ongoing drought has led to a significant decrease in the number of new cotton knotted bolls in the main producing areas of Brazil, and the weight of the bell has generally declined. To compensate for this year's losses, Brazilian cotton farmers plan to expand their area of planting to 1.7 million hectares in 2022/23, adding 100,000 hectares, with sowing to begin in January 2023. At present, Brazil has sold most of its cotton in 2021/22, and cotton farmers have begun preparations for seed expansion to maintain the market share of Brazilian cotton in Asia.