On December 7, after Monday’s sharp drop, ICE cotton futures reversed again on Tuesday. With the “Omicron” mutant strain being less harmful than expected, traders began to turn their attention to conventional factors that drive price changes, such as U.S. cotton export sales and supply and demand forecast reports.
Regarding Thursday’s USDA supply and demand forecast, traders generally believe that US cotton ending stocks are expected to increase, but global ending stocks may decline slightly. Regarding this week’s export weekly report, the market expects that last week’s sharp drop in cotton prices will stimulate more demand for US cotton, and US cotton signings may increase significantly. However, due to the epidemic, US cotton shipments are unlikely to improve.
On the 7th, the U.S. dollar index rose again as traders awaited the Federal Reserve’s monthly interest rate meeting next week. Powell has already stated that he will tighten the stimulus package and an interest rate hike will definitely come sooner.
Crude oil and related energy products rose that day after Saudi Arabia raised oil prices. In addition, as the threat of the “Omicron” mutant strain has diminished, speculators have purchased travel stocks and energy futures products in large quantities.
Analysts said that as the US cotton harvest and processing enters the advanced stage, the market believes that the supply of new US cotton flowers will increase significantly around mid-January next year, so there will be strong sales, and the problem of slow shipments can only be left until next year. Solved, the recent sharp correction in cotton prices has given textile mills an excellent opportunity to obtain goods at low prices and price.
</p
