Seasonal Supply Pressure In India Market Will Undoubtedly Further Drag On Global Cotton Prices.

The November USDA supply and demand report shows that the world's cotton production is 17 million 914 thousand tons, consumption is 16 million 655 thousand tons, and the surplus is 1 million 259 thousand tons.

Considering the import of 900 thousand tons in China's quota and the import of 100 thousand tons in the bonded area, there is a surplus of 260 thousand tons of cotton in the world besides China.

In 2016/2017, global cotton supply is slightly loose except China, which can not play a significant role in pulling or suppressing prices.

According to the state, the India government announced that the paper currency with a face value of 500 rupees and 1000 rupees was cancelled at 0:00 on November 9, 2016, which is not conducive to the purchase of seed cotton in India in the short run, causing cotton prices to go up quickly.

Beginning in November 22nd, India seed cotton purchase volume returned to its previous level, and domestic cotton prices stopped rising.

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The volume of purchase increases, and seasonal supply pressure will put pressure on the cotton market.

In 2015/2016, cotton prices in China experienced a V trend, and the market sentiment was optimistic from the extreme pessimism caused by the massive storage of cotton reserves.

From time to time, cotton prices were successfully built from 3 to April in 2016, and even after entering the 2016/2017 year, cotton prices are gradually climbing.

The listing is postponed, Xinjiang's pport capacity is tight, and the supply pressure of the cotton market has shifted. However, in the context of financial capital entering the market, domestic cotton prices are expected to show a downward trend of L.

While the impact of the cancellation of some banknotes in India on the cotton purchasing market is weakened, the export and export profits of the India Pakistan trade dispute are fermenting.

According to China cotton information network,

On the other hand, it has officially announced the prohibition of new customs clearance for India cotton, India's export ban on Pakistan's big agricultural products (quotes 12.81 -1.84%, buying), and Pakistan's domestic cotton prices.

However, the export of cotton in India is blocked, which will suppress the domestic cotton prices in India.

In China, the comprehensive USDA supply and demand report and relevant domestic organizations and agencies predict that domestic cotton production will reach 4 million 500 thousand to 4 million 800 thousand tons in 2016/2017, and consumption will be 7 million 500 thousand to 7 million 800 thousand tons, and imports will be between 900 thousand and 1 million tons. In the case of cotton reserves, domestic production will not be considered in 2016/2017.

There is a gap of 2 million tons in supply.

In August 24, 2016, the national development and Reform Commission announced that according to the current cotton supply and demand situation and market operation situation, in 2016, the new cotton market will not be arranged during the period from the end of February 2017 to the end of February 2017. In 2017, the reserve cotton rotation will start from March 6th, and the deadline will be temporarily at the end of August. The number of daily sales will be temporarily suspended by 30 thousand tons.

If cotton prices rise rapidly at home and abroad over a period of time, the auction rate of cotton reserves will exceed three days a week and more than 70%, and the number of daily listing will be increased appropriately, and the sales period will be extended.

According to 6 months and 120 working days to calculate, in 2017 3 to August, the amount of reserve cotton is 3 million 600 thousand tons, which can cover the domestic supply gap in 2016/2017.

In 2016, the closing time of reserve cotton was at the end of September, and it was about 5 months from the cotton market in March 2017.

On the supply side, cotton production is between 4 million 500 thousand and 4 million 800 thousand tons, import volume is 400 thousand tons, mainland consumption is between 2 million 800 thousand and 3 million tons, Xinjiang textile enterprises have locked 1 million tons of cotton resources ahead of schedule, and in the period of 5 months, the supply and demand of cotton market is over 1 million tons.

There were three reasons for the rise of domestic cotton prices from 9 to November in 2016: first, the mainland's cotton market was postponed; the textile enterprises expected to expand the difference between the old and new cotton prices; the cotton storage in September continued to be hot; second, the listing of Xinjiang's cotton was postponed; during the national day, the situation of cotton picking up in Xinjiang was outstanding; third, the rise in the price of coal and other energy resources was superimposed with the overload of highway pportation, and Xinjiang's energy outflow through the railway increased, and the cotton pport capacity became tense.

We believe that in the international arena, the cotton in the northern hemisphere has been listed in the four quarter, and the seasonal supply pressure is unfolding in the India market, thereby dragging the global cotton prices.

December is the peak of China's cotton imports to Hong Kong, and domestic cotton prices are under pressure.

On the domestic side, the delayed delivery of cotton and the shortage of pport capacity in Xinjiang resulted in mismatch of supply and demand of cotton in time. The cotton price rose significantly in the early part of the year, and the tension of pport capacity was eased. In addition, the cotton sales began to turn out in March, and the sales pressure of cotton enterprises increased.

For more information, please pay attention to the world clothing shoes and hats net report.