China Cotton Reserve Management Co., Ltd. recently issued an announcement stating that according to notifications from relevant state departments, the first batch of central reserve cotton rotation in 2022 will be due on November 11, 2022. The follow-up will be based on the needs of cotton market regulation and the purchase situation of new cotton, etc. Choose an opportunity to start the second batch of central reserve cotton rotation.
On July 13 this year, the first batch of central reserve cotton was launched, with a quantity of 300,000-500,000 tons. The purchase and storage price is the arithmetic average of the Chinese cotton price index and the national cotton price index. At that time, this provided certain support and boost to the continued decline in domestic cotton prices and sluggish market sentiment. However, domestic and foreign cotton prices continued to decline subsequently, and purchasing and stockpiling progressed tepidly.
It is understood that the market has previously reported that the first batch of cotton reserves from the central reserve this year will be stopped. The market generally believes that the negative factors have “fallen”, and domestic cotton prices have risen steadily.
“In fact, the early decline in cotton prices at home and abroad has a lot to do with sluggish demand. The purchase and storage of up to 500,000 tons will not have a major impact on cotton prices, let alone determine the rise or fall of cotton prices.” Yu’an Cotton Trade Yang Yong, general manager of the company, told reporters that from the nature of the industry, cotton is a weak demand variety, and more time needs to be analyzed on the supply side to judge market price trends. If there are no problems on the cotton supply side, the excessively high cotton prices will definitely be unsustainable. The early decline in cotton prices has a lot to do with the increase in cotton production in the new season.
According to the reporter’s understanding, as of now, domestic new cotton picking has basically ended, and lint processing and listing are at their peak. However, new cotton sales, warehousing, public inspection, outgoing warehouses, transportation and other links have been affected by the epidemic. Xinjiang cotton It is difficult to effectively increase the number of products entering the market, and it is also difficult for mainland textile companies to purchase cotton raw materials. Market participants expect that there will still be many variables in the domestic and foreign cotton markets, and it is recommended that spot traders and futures traders enter the market with caution and pay attention to risk management and control.
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