It is understood that Zheng cotton futures jumped short and opened low in the night trading on August 19. The main contract fell below the 18,000 yuan/ton round mark. The enthusiasm of cotton spinning mills and middlemen for price-pointing purchases increased significantly, and the “fixed price” transaction was cold. The price-pointing resources of traders and futures companies have increased (the basis has increased slightly, and traders’ profits have expanded).
Cotton-related companies in Jiangsu, Henan and other places said that the new crown epidemic appeared sporadically in July, and various regions increased their epidemic prevention and control efforts. In addition, Zhengzhou, Xinxiang and surrounding areas in Henan suffered particularly severe epidemics. Heavy rains hit, and the number of cotton transferred to Xinjiang warehouses dropped significantly. At present, the price difference between Xinjiang cotton quotations in warehouses inside and outside Xinjiang has dropped to 100-200 yuan/ton. Xinjiang cotton in warehouses in the mainland has attracted more attention from cotton spinning mills and middlemen, and the point price transactions are significantly higher than those in the supervision warehouses in Xinjiang.
Several textile companies have reported that a large cotton company has recently pre-sold Xinjiang cotton in 2021/22. The buyer relied on the CF2201 contract or CF2205 contract to adopt the basis purchase or point price model, but Cotton-using enterprises are generally worried and not enthusiastic about participating. On the one hand, the weather in Xinjiang’s cotton areas from August to October is still full of variables, and cotton quality and other indicators are unpredictable. Once cotton companies use low-quality or high-quality cotton instead of delivery, textile companies will be a bit “dumb and eating coptis.”
On August 20, the “Double 28” Xinjiang machine-picked cotton quotation in warehouses in Jiangsu, Henan and other places was 18,200-18,400 yuan/ton, while the port customs clearance was M 1 1/ 8 Brazilian cotton traders quoted a net weight of 18,800-19,000 yuan/ton, and the competitive advantage of Xinjiang cotton has gradually improved. </p
