On the night of February 14, Zheng cotton opened sharply lower, falling to as low as 21,280 yuan/ton, a drop of more than 400 points from the previous day. A careful look at the market news revealed that except for the decline of US cotton, there were no other obvious negative factors. This phenomenon occurred in the second week after the holiday. It should have little to do with changes in fundamentals. It must be the result of short-term capital games. Since short-term capital games are played, the depth of the decline is limited.
At present, the cotton spinning industry is just operating normally, and many companies are rushing to make pre-holiday orders. After entering the peak season, the changes in new orders have not yet been fully reflected, and it will take time to prove. The traditional shortcoming of “one negative line changes the three views” must be avoided. “The opposite is the movement of the Tao, and the weak is the use of the Tao.” Since the order is a variable, it cannot be simply judged for granted. Now the downstream enterprises have just fully recovered, and the demand for raw materials is not high. As the inventory is consumed, the procurement of enterprises will be gradually released. By then, the acceptance of high-priced cotton by textile enterprises will also be truly reflected in the market. Whether the procurement is good or bad Wait for the market to give the answer.
At present, the spot price of Xinjiang cotton is strong and will be difficult to shake for the time being without the influence of major negative factors. On the first day of trading after the Spring Festival, the price of Zheng cotton followed the fluctuation of foreign cotton and showed a large increase. At this time, the spot quotation of Xinjiang cotton immediately increased by 300-500 yuan/ton, and the price of high-quality cotton reached more than 23,000 yuan/ton. Subsequently, Zheng Cotton fell and adjusted, but the spot price showed strong performance. Upstream ginning companies still maintained their quotations after the increase, and were unmoved even if the market was deserted. This shows that now the futures are rising and the spot is rising, while the futures are falling and the spot is stable. special period. The reason behind this is that ginning companies purchase processed lint cotton at high prices and are unwilling to sell it at a loss. At present, when the pressure on banks to repay loans is not very high, most ginning companies still insist on selling at high prices. As long as spot prices are strong, futures will not fall deeply.
From a time perspective, there are very few cases where a downward trend starts in February. First, the industry is in the peak production season, and the quality of downstream demand needs to be verified by the market; second, cotton has entered a new production cycle in April and May, and changes in cotton planting area, including weather speculation expectations, will also gradually weaken. Third, the intensity and frequency of interest rate hikes by the Federal Reserve will also affect the trend of commodities to a great extent. March is just the beginning of raising interest rates and will not have a great impact on commodities; fourth, foreign cotton production and trends will also have to Finally, wait until the new season cotton is planted and grown. To sum up, it is too early to judge the turnaround of cotton prices, and they will still remain range-bound for a period of time.
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