Fundamentals Improved, Cotton Market Rose This Week

1、 Price quotation

According to data, cotton spot market rose this week, the price of 3128b lint on the 16th was about 15566 yuan / ton. 64% month on month, up 35.56% year on year.

2、 Market analysis

Domestic: this week's cotton spot showed an upward trend of shock. On the 16th, China's cotton price index 3128b was at 15551 yuan / ton, up 182 yuan / ton compared with last Friday. According to statistics, the inventory of cotton industry in the warehouse of textile enterprises in March was 917500 tons, an increase of 35100 tons compared with the end of last month. Domestic cotton supply is sufficient, commercial stocks and imported cotton have increased, in addition, there may be national reserve supply; the demand side is general, and the short-term driving force is not strong.

In April 2021, the forecast adjustment of domestic cotton production, sales and inventory is as follows: in 2020 / 21, China's cotton output is 5.95 million tons, which is the same as that of the previous month, with a year-on-year increase of 107000 tons or 1.83%; the consumption of 8.29 million tons is increased by 514200 tons on a month on month basis, with a growth rate of 6.61%, and a year-on-year increase of 813300 tons or 10.88%; the final inventory is 6.3598 million tons, with an increase of 195800 tons on a month on month basis, with an increase of 3.18% and a year-on-year increase of 131200 The gap between production and demand was 2.34 million tons, an increase of 706300 tons compared with the previous year, the inventory consumption ratio was 76.72%, and the month on month decrease was 2.56 percentage points, down 6.3 percentage points compared with the previous year.

International: the US dollar continues to weaken recently, increasing the overall commodity prices. In April, USDA lowered global cotton final inventory by 246000 tons to 20.349 million tons. Last week, the sharp decline in US cotton exports led to a medium speed dive in ice futures. This week, the US dollar index fell sharply again, which led to a collective rise in the commodity market. At the same time, the market expected that this week's US cotton export weekly report was positive, superimposed on the adverse weather in Texas, and ice cotton rose rapidly on the 15th. As of the 15th, the international cotton price index (SM) was 95.12 cents / pound, and the international cotton price index (m) was 91.53 cents / pound.

Futures: boosted by foreign cotton prices, Zheng cotton rose this week. The domestic short-term import sliding tax quota and the expected dumping and storage are to be implemented. There is a certain inventory pressure in the middle link of the industrial chain, and zhengmian follows the US cotton with a small increase. On April 16, the settlement price of 2109 contract of Zheng Mian was 15360 yuan / ton, up 185 yuan / ton compared with last Friday.

3、 Downstream industry chain

Affected by the recent weak price shocks and the reduction of downstream new orders, textile mills generally do not have strong purchasing intention. Pure cotton yarn market transaction downturn. Some traders in Foshan have no trading volume, and downstream customers maintain production and demand is insufficient. Jiangsu and Zhejiang market trading volume is not much, are 32S high configuration. The market as a whole tends to be cold, shipment gradually unsalable, combed products inquiry is not much, conventional varieties slightly trading. The market supply is sufficient, and the inventory of some varieties in the mill has increased significantly.

At present, Xinjiang cotton has entered the planting season, and farmers generally expect that the planting area will decrease, which will boost cotton prices. The downstream yarn orders are mainly purchased on demand, and the cotton market is expected to rise in the future.