Commodities generally fell last night, and US cotton also fell sharply. ICE’s main US cotton July contract fell by 3.25 cents/pound, and the settlement price was finally reported at 84.98 cents/pound. The rise in U.S. cotton was due to the impact of its CPI reaching a new high since 2008, and also due to the overall decline in U.S. soybean, corn, and wheat prices. In addition, the just-released weekly U.S. cotton export data was bearish, with the volume of upland cotton contracts reduced by 15% from the previous week and 41% from the average of the previous four weeks. Shipment volume was also down 39% from the previous week and 23% below the previous four-week average. Stimulated by a variety of negative factors, fund bulls fled and prices fell rapidly.
Zheng cotton futures showed a weak downward trend from the opening on Thursday morning. The main CF2109 contract fell below the 16,000 yuan/ton integer mark, and reached an intraday low of 15,510 yuan/ton on Friday. Ton. The sharp decline in futures prices has prompted the market to tighten its mentality, and the wait-and-see atmosphere has suddenly picked up. According to a survey of cotton-related companies in North and South China, the pace of orders received by textile companies has slowed down recently, and the products of some gauze companies have slightly rebounded. In addition, with the arrival of Zheng Cotton’s May warehouse receipt delivery, downstream textile companies have greatly reduced their enthusiasm for purchasing raw materials, and spot trading has Really light. Although futures prices have fallen back in the past two days, it is still difficult to stimulate their enthusiasm for pending orders.
Looking back at the trend of cotton prices in April, domestic and foreign weather disturbances during the planting period are particularly obvious. As the saying goes, “success is a failure, success is a failure.” From May to June, it is difficult to judge whether the weather will still have an adverse impact on cotton prices. However, domestic supply is abundant and U.S. cotton inventories are obviously tight. Both bulls and shorts have reasons to support their game. Therefore, during the off-peak demand season, there are various uncertainties intertwined with how much Indian orders can be returned to the country and whether they are sustainable. It is expected that the sustained rebound of cotton prices will still face many challenges. </p
