Cotton Price Is Expected To Usher In A New Round Of Rebound: 5 Major Reasons

At present, about

The announcement has not yet been released.

The spot market and the spot market have fallen into a long stalemate and even rebounded.

Cotton companies get a breathing space.

Some cotton enterprises in and outside Xinjiang indicated that in late March, some cotton related enterprises were quietly entering the Xinjiang to purchase high grade and high quality cotton picking cotton and local machine picking cotton, and the quoted price increased by 100-200 yuan / ton. Due to the low inventory, lint production and marketing were "hanging upside down" 1200-1500 yuan / ton, and the pressure on short-term funds was not big. Therefore, the sentiment of cotton enterprises to sell their wait-and-see continued to rise, and the quotation of Xinjiang cotton in the mainland warehouse was also showing signs of bottoming out. 2128B2, 3128B2 and 2128C2 (horse value below 5.2) were tentatively reported up 100-200 yuan / ton.

The author believes that cotton prices are expected to usher in a rally. The 3128B2 (breaking strength 28CN and above) grade lint's gross price will be raised to 12300-12500 yuan per ton. The reasons are as follows:

1.3, April cotton consumption to force, high season market support cotton spot rebound.

According to the survey, since March, downstream garment factories, printing and dyeing mills, weaving mills and cotton mills have entered the period of production and marketing. The demand for cotton yarn such as C21S, C32S, C40S and JC40S and JC60S has increased considerably compared with that in 1 and February. Some large and medium-sized cotton textile mills have reduced the production of high count yarn and combed yarn, increased the proportion of C21S-C40 cotton yarn and blended yarn, and continuously increased the consumption of cotton for 2128C2, 3128C2 and high grade and low breaking strength.

Weaving enterprises in Jiangsu, Zhejiang, Shandong, Henan and other places reflect that orders are generally placed in mid May (a few manufacturers are in early June), and the procurement of imported spot and futures yarn has continuously declined, and the competitiveness of real estate yarn and Xinjiang yarn has been greatly enhanced.

2., cotton enterprises and middlemen entered the market to purchase, and the "reservoir" began to play a regulatory role.

Since the state's total withdrawal from the purchase and storage policy in 2014, cotton growers have been directly butting with cotton enterprises, and the cotton enterprises' direct docking with cotton mills has made cotton operators unable to enter the market. In the face of the profit of 30-50 yuan / ton, the middlemen can only choose to wait and see. Even if the funds of cotton enterprises are not enough and the foreign cotton arrivals fall sharply, the operating enterprises are not too easy to "store water". But as the downstream consumption picks up, the inquiry and purchase of cotton mills gradually get warmer, and the enthusiasm of the middlemen to enter the market is quickly ignited.

3., the release of detailed rules for cotton reserves has been postponed, and the supply of high quality cotton has been tightened.

In Xinjiang cotton area in 2015, the quality of lint cotton slipped significantly due to weather and cotton seeds. After the concentrated digestion of -2016 in March October 2015, the quality of Xinjiang cotton with 2128B2, 2129B2 and 3128B2 (breaking strength 28CN and above) has become very rare. Most cotton mills purchase raw materials in accordance with the purchase pattern. Stock is usually in 5-10 days, and most of them are carried out immediately after payment. Due to the uncertain time of the current cotton storage, the waiting and waiting cotton mills can only look at the present and increase the purchase of Xinjiang cotton.

4. cotton costs support spot prices rebounded briefly.

It is understood that as early as April, cotton processing enterprises in southern Akesu, Korla, Kashi and other places 2015/16 cotton comprehensive cost concentrated in 13000-13200 yuan / ton (including financial expenses), if sold at the current market price, at least 1200-1500 yuan / ton loss, part of cotton enterprises in 2016 foreign contract, leasing equipment or the overall pfer of cotton ginning factory will rise.

5. in 2016, the domestic cotton planting area or a relatively large decline to a certain extent favorable domestic stock.

According to the National Bureau of Statistics survey data, the cotton planting intention in 2016 dropped by more than 10%.

Among them, the intention of planting cotton in the mainland dropped considerably, and Xinjiang was relatively small.

From the recent visit in Xinjiang, the enthusiasm for adjusting the planting structure is expected to increase only in North Xinjiang because of the convenience of irrigation and pportation. South Xinjiang is affected by natural conditions. Corn, wheat and other crops have no advantage over cotton. Therefore, it is estimated that there will be little room for adjustment of cotton planting area.