Hidden Factors To Cotton Price Trend Judgment Blind Spot

China's HSBC manufacturing index in March hit a 4 month low, highlighting the obvious signs of slowing production activity in the manufacturing sector. This also indicates that the growth rate of the textile industry may further decline in the future, and the future development of textile enterprises will continue to be dragged down.

At the end of this month, the purchase and storage of reserve cotton will end in 2011. For the late market, the worries about the continued weakness of downstream textile enterprises, which are hidden in the market, will make the market parties have a blind spot in judging the cotton price trend in the future market.

International market: last week

Domestic market: Cotton spot price reappears slightly adjustment, market sale intention strengthens, planting willingness drops.

In recent days, China's cotton price index continued to decline. On the 26 day, the CC Index 328 index fell 8 yuan to 19522 yuan / ton.

As of March 23rd, the total acquisition of State Reserve has exceeded 3 million tons, of which Xinjiang cotton accounts for about 1 million 670 thousand tons, and the mainland cotton accounts for about 1 million 350 thousand tons. With the acquisition and storage entering the final stage, some market participants believe that, according to the current weak situation of the downstream textile enterprises, cotton prices will most likely seek new support in the later stage without the support of policy price, but when the new supporting point will emerge, it will be difficult to predict.

Cotton sub Market: the market price of cotton by-products has been callback in recent years, but due to the obvious decline in supply, the ability of product prices to fall down is strengthened, and the price of cottonseed, cottonseed oil and cottonseed meal is expected to be relatively limited in the short term.

Related varieties:

ICE cotton Market: supported by some speculative buying, last month's ICE cotton futures contract rose slightly last Friday, while other forward contracts fell slightly due to fundamentals.

The main contract price in May was 89.63 cents / pound, up 5 points, and July contract closed at 90.27 cents / pound, up 4 points.

The market as a whole remains light; market participants believe that once China's market quotas are issued, imports of cotton will quickly replenish cotton reserves to bring shortages of cotton in China's market, and the sell-off of reserve cotton will stabilize the market's potential rebound at any time.

Zheng cotton Market: from the disk, today's Zheng cotton main 1209 contract opened high, a narrow downward trend, the final closing down, volume warehouse increased.

On the same day, Zheng cotton warehouse increased 36 sheets to 1992 sheets, and effectively forecast 1401. Technically, the average line system was still in a downward arrangement, and warehouse receipt pressure and downstream consumption weakness continued to suppress cotton price inversion.

Market review: last week, the US cotton exports were more favorable to boost the ICE cotton contract in recent months, but the pressure from the supply and demand market continued to suppress the reversal of contracts in the far months. Although there were signs of bottoming in the technology, even though there were not many favorable factors to boost the rebound in the near future, on the domestic market, from the end of the purchase and storage, the market participants had different judgments on the cotton price trend in the later stage, and the latter direction would still depend on the downstream consumption situation.

Montenegro pointed out that the overall market environment is still not optimistic. At present, the market and the market of Zhengzhou cotton market are facing a large number of warehouse receipts pressure, as well as the industry's worries about the late market hidden pressure, the issuance quota and the continued weakness of the downstream textile enterprises, will continue to hinder the reversal of the technical disk, and there is a possibility of continuing to explore new supporting points in the future.