Since June, ICE cotton futures have continued to consolidate in a narrow range of 80-83 cents/pound, even though the net contract volume of U.S. upland cotton for the 2022/23 season reached 108,953 tons in the week (May 26-June 1) (compared to the previous week). (increased 79%, hitting a new high in the year), and ICE’s main contract failed to test 85 cents/pound again. Since mid-March this year, bulls have tried 85 cents/pound three times, all of which ended in failure.
Recently, under the negative factors such as continuous rainfall in western Texas, increased cotton production in Australia/Brazil in 2022/23, expected growth in cotton planting area in major producing countries such as Pakistan/India in 2023, and slower-than-expected global economic recovery, the fund lacks confidence to raise prices. , the disk is in a weak equilibrium state.
Some textile companies in Jiangsu, Shandong and other places reported that Zheng cotton has risen sharply since June, and the price difference between domestic and foreign cotton under the 1% tariff has reached 1,500-2,000 yuan/ton. Although the inquiry and transaction of bonded cotton at the port and far-month shipments are relatively active, the price difference between domestic and foreign cotton is relatively active. There are relatively few single and long-term orders, mainly small and medium-sized textile enterprises replenishing their inventory, and it is difficult to increase shipments.
It is understood that the quotations of bonded cotton and customs-cleared cotton at ports have been relatively confusing recently, mainly due to traders’ cotton holding costs, financial pressure and different predictions of cotton price trends in June and July. For example, on June 8-9, the quotation of bonded Brazilian cotton M 1-1/8 (strong 28GPT) in Qingdao Port ranged from 93.25 cents/pound to 96.45 cents/pound, a difference of more than 3 cents/list; US cotton 31-3 The price difference between the high and low prices of 36/37 has also widened to 2-3 cents/pound, making it difficult for textile companies to grasp the price when purchasing.
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