The Epidemic Has Great Impact On Cotton Consumption, With A Focus On The Resumption Of The Market Outlook.

Affected by the recent outbreak of new crown pneumonia, the first annual meeting of the Zhangjiagang cotton merchants association in 2020 was held in the afternoon of February 12th by video conference. The video conference was chaired by Zhu Gensheng, vice president and Secretary General of Zhangjiagang cotton business association. At the meeting, the vice president of the Zhangjiagang cotton chamber of Commerce, some of the enterprises, some of the member enterprises and the heads of the invited agencies discussed the impact of the epidemic on cotton consumption, the market trend in the coming period and the market opportunities after the end of the epidemic.

Cao Kai, a researcher at the new lake futures farm, said: after the crash, the market will maintain the trend of the shock market from the fundamentals. At present, if there is a rebound, it will see 13500 higher. The trend of late market depends on the resumption of work after the epidemic, as well as the demand for orders. Of course, heavy demand during the Spring Festival also led to the transfer of foreign demand to Southeast Asia. Purchasing and storage situation: for the current storage and purchase situation, the storage capacity has been reduced, and the reserves have declined this week. Later, we need to pay attention to the situation of domestic reemployment and the situation of receiving orders.

Xu Xiaoxiang, vice president of Zhangjiagang cotton business association and chairman of seashore trade: with the UK off Europe, the US economy is less likely to go down. If the global government releases water, it will be good for infrastructure construction, black line and ore formation. Cotton is not a necessity. Even if the epidemic is improving, there will not be any significant increase. Many futures trading markets have already withdrawn more than 30 thousand hands. If the resumption of work could affect about 500 thousand tons in March, there will be limited space to fall, but there is a great chance of turning over. In the near future, the whole market is stronger than the domestic market.

Chen Bo, vice president of Zhangjiagang cotton chamber of Commerce and general manager of polycotton net, at present, I understand that enterprises are running in low inventory and less in stock. In the past year, the normal spring festival will be stocked with 35 million tons. This year, we have prepared one thousand or two thousand tons for our customers. Their platform is based on a small information management company, which is not short for the impact of the epidemic. Customer reemployment rate is relatively low. Zhangjiagang has difficulty in resuming work.

Chen Jun, vice president of Zhangjiagang cotton chamber of Commerce and general manager of Yi cotton purchase: at present, about 20% of the textile enterprises in China are returning to work one after another, but the resumption of work is not equal to the resumption of production. Workers are expected to enter production posts in the end of February, and the recovery rate will reach 50%. It is expected that the factory will resume normal production in March. In addition, warehouses and logistics are also at a standstill. The market is in the range of 12800-13200. In the later stage, we need to pay attention to the improvement of the new crown pneumonia epidemic situation and whether the workers returning to work will bring more outbreaks. The trading volume of the easy shopping platform is greatly reduced after the Spring Festival. The judgment of the breach is based on the time of signing the contract. The contract signed before January 20th is a force majeure, and the contract signed after January 20th will need the friendly negotiation between the two sides.

Wei Anhe, general manager of Zhangjiagang cotton trade association and general manager of Jiangsu Imp. & amp; Export Co., Ltd.: affected by the epidemic, consumption is decreasing, and imported cotton is not coming, both of them offset each other. I think 12500 is a bottom. In the later stage, we should pay attention to whether the price drop will reduce the planting area. At present, if we are concerned about the fall in prices, we can buy the call option, the cost is also the royalty, and at the same time sell the put option to reduce the cost. The spinning enterprise operation strategy: we suggest that we buy 200 call option, continue to put into operation, maintain low position in April, and then consider reducing production. Low domestic prices will affect the global planting area, not too bearish.

Mao Tengfei, vice president of Zhangjiagang cotton chamber of Commerce and director of the search for derivatives network, said: the turning point of new cases and suspected cases of the new crown pneumonia epidemic has already appeared. The total inflection point will appear in 10 days. How to balance the contradiction between resumption of work and epidemic control will become the focus of the work in the future. Besides, cotton trade is of little value and interest in capital is not strong. At present, there are not many records for the gauze system, similar to that during the Spring Festival. Cotton stocks in downstream mills are relatively low, and are currently in a state of pure consumption and can not be replenished. And the inventory of the cloth factory is quite sufficient. Pay attention to the influence of locust disaster in Africa.

Wang Jun, deputy general manager of Suzhou Business Department of new lake Futures: eight trading days after the holidays, commodities and domestic stock markets first fell and then rebounded, indicating that the market is more focused on the support of the national fiscal policy and financial policy after the outbreak of the epidemic. The cotton market has rebounded following the short-term recognition of the bottom of 12500, but on the other hand, it is out of the epidemic. Fear, actively pushing up volume, will limit the height of the late rebound. The market for some time to come will continue in fear and anticipation. I agree with Wei general that it is the best choice to use hedging options to hedge risks.

Dan Hua, vice president of Zhangjiagang cotton chamber of Commerce and general manager of Xinjiang West China Agricultural Technology Co., Ltd., Xinjiang: at present, Xinjiang cotton is in the spring irrigation period. Due to the epidemic situation, it can not enter Xinjiang before the year. This will have a certain impact on logistics, especially the transport of fertilizers needed before the planting period in March and April. In addition, the snowfall of the Tianshan Mountains is only 1/3 in the past year. The water is limited and the water is very strict.

Jin Ping, general manager of Suzhou business department, new lake Futures: affected by the epidemic, the resumption of production is limited after the Spring Festival. It is predicted that the possibility of resuming work in the end of February and early March will be relatively large. The demand will not start very soon. The fluctuation of cotton varieties is not too large. Speculative funds may be more concerned about other high volatility varieties.

Yin Jihua, vice president of Zhangjiagang cotton chamber of Commerce and general manager of Jiangsu Jinsheng International Freight Forwarding Co., Ltd.: at present, the epidemic has only a certain impact on the import business of some state-owned enterprises. The use of quotas has not yet been affected. The Bonded Zone warehouse has not been fully resumed.

Jiang Hai, vice president of Zhangjiagang cotton chamber of Commerce and general manager of Jiangsu Hai Shun Express International Freight Forwarding Co., Ltd.: at present, the Bonded Zone warehouse has only been bonded to the foreign trade zone and Tianjin Hua Bang has returned to work. There is no problem with cotton entering area, but if we want to go out, we will not return to work. At present, logistics has not been fully recovered by the epidemic.

Finally, Xiao Jingyao, vice president of Zhangjiagang cotton trade association and vice president of Huafang group, issued his view: at present, large textile enterprises have resumed their jobs in February 10th, 8 days later than in previous years. However, the resumption of work is still not the best, production is less than half, and the main energy is still on epidemic prevention. The main production base of cotton spinning is also very strict in Xinjiang. It is estimated that it will be resumed in March. The largest market for downstream consumption of veil is Foshan Zhangcha, which has to return to work in March. The estimated impact is 80 to 1 million tons, and the impact of the epidemic on foreign trade orders can not be estimated. Enterprises are unable to take orders now, and the existing orders are also being transferred. Later, the main points that affect cotton prices are also in the external market and national policies. Later, it is also necessary to see whether the purchase and storage will increase and the purchasing power of US cotton will not be optimistic in the first half of the year without major policy benefits.