Entering July, ICE cotton futures have experienced “three consecutive negative days”. The December contract has exceeded 95 cents/pound and 90 cents/pound (the intraday low of 88.10 cents/pound on July 6). The probability of continued radical interest rate hikes has increased significantly, the risk of U.S. economic recession has increased, the cotton planting area in the northern hemisphere has increased significantly in 2022 year-on-year, and commodity futures such as crude oil, wheat, and Lun copper have overall peaked and fallen sharply. The market has stabilized and the rebound is relatively weak, and traders and cotton-related companies are somewhat less confident.
Cotton trading companies in Zhangjiagang, Qingdao and other places reported that the foreign cotton market this week still showed the following three characteristics: First, the quotations of bonded U.S. cotton, Brazilian cotton, Indian cotton, etc. at the port are still extremely chaotic, and the price difference between high and low has even reached 8-10 US dollars. points/pound, not only cotton companies feel headaches, but cotton spinning mills and middlemen are also not adaptable; secondly, with the sharp decline in ICE’s main contracts, the direct import cost of bonded cotton under the 1% tariff has narrowed significantly and even aligned with the RMB quotation of customs-cleared foreign cotton. , the advantage of customs clearance cotton resources has basically disappeared, and inquiries and shipments have continued to weaken compared with May/June; third, due to relatively few high-count yarn and high value-added orders, which are significantly lower than expected, a few large and medium-sized cotton textile companies have recently begun to resell U.S. Pima cotton and high-index U.S. cotton/Australian cotton/Brazilian cotton in 2020/21 and 2021/22.
It is understood that since late June, the overall non-bonded cotton inventory in China’s major ports has declined slightly, while bonded cotton inventory has continued to rebound and increase. Among them, the arrival and warehousing quantities of Brazilian cotton and US cotton in 2021/22 account for a large proportion. . An international cotton trader stated that due to the continued large-scale recession in the main cotton-producing areas in April and May, the harvesting, transportation, processing, and shipping of seed cotton were significantly delayed by nearly 2 months. Therefore, the current shipping schedule of Australian cotton in 2021 has been postponed. By August/September/October, otherwise, according to usual practice, it would be a period when Australian cotton gradually arrives in Hong Kong in large quantities and is sold intensively. Judging from the survey, international cotton merchants and domestic trading companies are currently focusing on selling US cotton in 2022/23. The number of listed resources is relatively large, and most shipping dates are from January to May 2023. With the main force of ICE in December The contract fell below 90 cents/pound, and the inquiry/firm orders of US cotton for far-month shipments were relatively active.
</p
