As the Spring Festival is getting closer and closer, the price of Zheng cotton has shown a correction, while the price of Zheng yarn has a small correction and its performance is relatively strong. After the holiday, many companies will begin to gradually purchase new cotton. Now the production and sales price of cotton yarn is upside down. Will the yarn price rise and be smoothly passed to the downstream?
If we look purely at the price comparison of domestic and foreign cotton yarns, the price of domestic yarns is easy to rise but difficult to fall in the short term. Domestic cotton yarns have the upper hand over foreign yarns due to their excellent quality and delivery capabilities. Coupled with obvious price advantages, domestic yarns are highly competitive. With this advantage, downstream demand is guaranteed. From another perspective, as companies consume low-price raw material stocks, the cost of raw materials will gradually increase. For traders, the price of purchasing cotton yarn will also gradually increase in the future. When there is no more low-priced cotton yarn, as long as the market demand is there, There is a high probability that downstream companies will have to accept it passively, after all, the price performance of outer yarn is stronger.
According to raw material traders, textile companies have started to take holidays before the holiday, and yarn stocks are at a low level. After the holiday, there will be a peak demand season. At the same time, with the support of external yarns, there is a demand for domestic yarn prices to make up for the increase. Recently, cotton yarn has increased much less than cotton, and there are strong calls for a post-holiday increase. As long as the price of Zheng cotton can remain above 21,000 yuan/ton, there will be little resistance to rising cotton yarn prices. The same is true for the price of outer yarn. As long as the price of outer cotton can hold firm, the high yarn price will be stable. Next week will see the Federal Reserve’s interest rate meeting to discuss the issue of interest rate hikes. According to the signals released in the past, there is a high probability that it is also a hawkish signal. It is not ruled out that there will be a correction in commodity prices. Pay attention to whether domestic and foreign cotton prices can be maintained. Now the three major U.S. stock indexes have shown signs of decline, and the response of commodities has been slightly slow. The trend will become clear next week.
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