Domestic Cotton Prices Have Stabilized, And Market Demand Has Been Revival (4-8 May 2020).

During the May 1 holiday, the international market fluctuated little. After the holiday, domestic cotton prices showed signs of stabilization. The market still focused on the recovery of downstream consumption.

First, domestic cotton prices have stabilized.

This week, the international crude oil prices continued to rebound, driving sentiment in the commodity market to rise. The US Department of agriculture data showed that Zhou Meimian signed a strong contract volume and increased volume of freight traffic, and the atmosphere in the international market was warmer. During the long holidays, ICE futures first fell and then rose, but European and American countries were eager to resume work in the absence of complete control of the epidemic situation, thus laying hidden dangers for the future market. Zhengzhou cotton futures contract settlement price of 11705 yuan / ton, compared with the previous week rose 115 yuan / ton, or 1%; on behalf of the mainland standard grade lint market price of the national cotton price B index average price of 11402 yuan / ton, compared with the previous week fell 14 yuan / ton, or 0.1%. New York cotton futures contract settlement price of 56.27 cents / pound, up 0.43 cents / pound, or 0.8%, compared with the previous week; the average price of the international cotton index (M), representing the average price of the Chinese main port on the import cotton, is 66.04 cents / pound, 1.49 cents lower than the previous week, or 2.2%, and the cost of import RMB 11685 yuan / ton (based on 1% customs duties, including port and freight), down by 241 yuan / ton compared with the previous week, or 2. 0%, the price difference narrowed 227 yuan / ton compared with the previous week.

Two, cotton yarn prices continue weak

This week, the downstream cotton yarn market continued to be weak, and the export orders for grey fabrics were not improved. The conventional yarn is 925 yuan / ton higher than the domestic yarn, and the polyester staple price has dropped by 29 yuan / ton to 5593 yuan / ton.

　　 Three, outlook for the future

This week, the Executive Council of the State Council decided to allow small and micro enterprises and individual industrial and commercial households to postpone the payment of income tax. Vice Premier Liu He of the State Council called on the US trade representative and the Minister of finance. The two sides expressed the need to push forward the implementation of the first stage economic and trade agreement and maintain communication and coordination, showing that the recent international macro environment is relatively stable, but the US non farm employment data in April had a great depression. The biggest decline and the stronger US dollar index in the US Treasury's record refinancing scale also put pressure on cotton prices. Customs data show that clothing exports in the first 4 months of this year dropped by 20.2% compared with the same period last year, of which exports in April decreased by 30.3% compared with the same period in March. The decline is larger than that in March, which confirms that the impact of the new crown pneumonia epidemic on the global textile industry is still continuing to ferment. In the near future, it is just the window of weather speculation. The domestic futures market shows some desire to rush. However, under the market background of high global inventory and slow recovery of cotton consumption, the price uplink resistance is bigger, and the market participants should keep rational to the news disturbance.