According to feedback from cotton trading companies in Jiangsu, Hubei, Henan and other places, Zheng cotton has fallen sharply. Not only are Xinjiang cotton orders and price transactions more active in 2020/21, but commodity cotton inquiries and shipments are also higher than those in the previous two weeks. Speed up.
A medium-sized textile company in Henan said that considering the high purchase price of Xinjiang cotton in 2021/22, coupled with the continued stock-hoarding sentiment of cotton yarn traders in coastal areas such as Jiangsu, Zhejiang, and Guangdong in the past half month Cloth factory customers have also adjusted their purchases to a small quantity and multiple batches strategy. Therefore, they are still very cautious in purchasing cotton. The focus is on participating in bidding for reserve cotton and receiving futures warehouse receipts. At present, traders’ quotations for high-quality US cotton/Brazilian cotton in customs clearance and the price of Xinjiang cotton in mainland warehouses continue to be inverted, and the enthusiasm for purchasing foreign cotton has also been suppressed.
Judging from the survey, the differentiation of cotton companies is relatively serious. Some cotton trading companies and futures companies with high hedging ratios or 100% hedging have accelerated the production of Xinjiang cotton in 2020/21. And the sales efforts of the state reserve commodity cotton, and strive to clear the warehouse as soon as possible. A few ginners in Xinjiang are rushing to ship low-quality lint cotton from Xinjiang’s regulatory warehouses due to the gradual launch of new cotton and tight acquisition funds (some resources do not meet the conditions for generating warehouse receipts or the discount is too high).
Of course, there are also a certain proportion of cotton traders who are waiting to sell, and have no intention of selling below the CF2201 contract price of 18,000 yuan/ton. Xinjiang seed cotton purchases in 2021/22 have opened sharply higher, and the direct cost of lint cotton has been confirmed. There is no room for correction in cotton futures. In addition, Zheng cotton warehouse receipts have continued to decline sharply, and the launch period of machine-picked cotton in 2021/22 has been delayed by about a week, which has intensified Having solved the structural contradictions in domestic cotton supply in September and October, the main contract of Zheng Cotton has a high probability of regaining 18,000 yuan/ton. </p
