July 2, 2012 Institutional Watch - Cotton Futures

Main points

1. Price Bulletin: domestic lint: 129 level 20308 yuan / ton; 229 level 19423 yuan / ton; 328 level 18478 yuan / ton; 428 grade 17580 yuan / ton.

Domestic textiles: polyester staple fiber 9740 yuan / ton; viscose staple fiber 15070 yuan / ton; C32S price 25670 yuan / ton.

2. domestic spot: domestic cotton spot price has not been driven by the recent strong trend of zheng-cotton, and the price trend has slowed down. The main reason is that the downstream textile enterprises have not improved significantly, and some of the textile enterprises have continued to decline, but the market panic has been alleviated, and the mentality of the traders is relatively stable.

3. imported cotton: in June 29th, the price of China's main port of imported cotton rose in full swing under the pull of ICE futures. Most varieties rose 1.5 cents, while Brazil cotton and Central Asia cotton rose 0.5 cents, while Egypt's long staple cotton prices fell.

Whether it is China's massive purchase or the massive cancellation of the US cotton contract, the result is the increase in global inventories, and can not be rapidly converted into consumption. The drag on cotton demand is difficult to end.

4.USDA: in June 29th, the US Department of Agriculture released the actual coverage area report. In 2012, the US cotton sown area was 76 million 758 thousand mu, a decrease of 14% over the same period last year, of which the sown area of upland cotton was 75 million 330 thousand mu, a decrease of 14% compared with that of the previous year, and the planting area of Pima cotton was 1 million 428 thousand mu, a decrease of 24% over the same period last year.

5.ICE cotton: in June 29th, the European Central Bank launched a plan to boost the market by adjusting its capital structure. The US dollar index fell sharply, and also provided a rising opportunity for the commodity market, of which crude oil rose by nearly 10%.

European leaders launched a 120 billion euro package of stimulus packages. The European stability mechanism can directly inject capital into banks, which has benefited Italy and Spain, which were in trouble before.

Summary:

The near future

Market and peripheral markets are frequent.

Several important achievements of the EU summit are more important news. Meanwhile, China's PMI data on the textile industry's new order index, production index, new export orders index and other major indicators continue to perform poorly.

From a comprehensive perspective, China's commodity market is also more likely to launch a systematic market at the beginning of this week based on the EU summit, but the impact on commodities is different. This news is more favorable to crude oil, precious metals and non-ferrous metals than cotton, which is mainly based on the weaker fundamentals of cotton.

[MEIKO futures] US cotton has not yet escaped from the shock zone.

Overnight, in June 29th, Europe's rescue of the euro zone's troubled banks prompted a sharp fall in the US dollar index and a general rise in commodity futures. Meanwhile, USDA announced that 14% of the US cotton sown area decreased by a year earlier this year, which also provided support for cotton prices and the monthly contracts rose to more than 100 points.

On the news surface, the report of the real sowing area issued by the US Department of agriculture in June 29th showed that the cotton sown area of the United States was 76 million 758 thousand mu in 2012, which was reduced by 14%, of which the land cotton sown area was 75 million 330 thousand mu, 14% compared to the same period, and the planting area of the pimma cotton was 1 million 428 thousand mu, and it decreased by 24%.

In the international market, in June 29th, the price of China's main port of imported cotton rose in full swing under the pull of ICE futures. Most varieties rose 1.5 cents, while Brazil cotton and Central Asia cotton rose 0.5 cents. Egypt's long staple cotton prices fell.

Whether it is China's massive purchase or the massive cancellation of the US cotton contract, the result is the increase in global inventories, and can not be rapidly converted into consumption. The drag on cotton demand is difficult to end.

If the US cotton sowing area reduces supply pressure slightly and cotton production weather is not conducive to the increase in production per unit area, the drop in cotton prices will be limited.

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Domestic market, since this year, the pressure of Chinese textile industry continues to increase, and the deterioration of internal and external environment has constantly squeezed the profits of textile enterprises, resulting in frequent losses.

Affected by the slowdown in domestic demand growth, the domestic sales growth rate of the textile industry has obviously slowed down. In 1-5 months, textile enterprises in scale reached 1 trillion and 757 billion 158 million yuan in domestic sales value, an increase of 13.44% over the same period last year, and the growth rate dropped by 18.51 percentage points over the same period last year.

But from the latest data, textile and garment export data slightly improved in May.

Spot quotation. In June 29th, the price of C/A cotton in the US was 88.35 (cents / pound), and the general trade port delivery price was 14791 yuan / ton (calculated according to the sliding tax). The Australian cotton quotation was 91.10, the general trade port delivery price was 15230 yuan / ton, the Uzbekistan cotton quotation was 90.70, the general trade port delivery price was 15164 yuan / ton, the India cotton quotation was 82.60, the general trade port delivery price was 13880 yuan / ton.

National cotton price A index 19379 yuan / ton, down 1 yuan; B index 18443 yuan, down 3 yuan.

Market analysis, the European macro side plus good industry, that is, USDA expects us cotton next year's planting area decreased by 14%, making the overnight cotton price rise, but still not get rid of the bottom area, mainly because the biggest factor restricting cotton prices is the recession of consumption, so the broad market will continue or wait for more information guidance.

Zheng cotton's short-term rebound trend supports the trend pressure near 1910019500.

Operation, the short line rebound market interval 19100- gap rolling operation, trend judgement depends on 19500.

[a German study] the external market is rising, zhengcotton back up gap.

Friday CF1301 high concussion, CF1301 closed more than 10.4 million hands, a slight decrease in positions.

CF1301 closed at 19205 yuan / ton, up 50 yuan / ton, reduced 7766 hand; in June 29th, China's imported cotton (FC Index M) 82.23 cents / pound, up 0.94 cents / pound, 1% yuan tariff reduced price 13277 yuan / ton, sliding price conversion price 14300 yuan / ton.

According to New York's June 29th news, cotton futures closed up on Friday, rising sharply with many commodities and financial markets. European leaders agreed to take steps to ease the debt crisis.

The ICE12 cotton contract rose 2.62%, or 1.82 cents, at 71.33 cents a pound.

In June 29th, the cotton trading market of the national cotton trading market reached 11520 tons, an increase of 180 tons from the previous day, an increase of 560 tons of orders, and a total purchase of 126400 tons.

On the 29 day, the market was boosted by the rise in the external market.

Basically, the euro area has reached an agreement on the integration route. The US dollar has fallen and the oil market has rebounded, and the commodity market has seen a short rebound. However, the overall macroeconomic situation has not yet changed. The rebound will be dropped again after the announcement of the data in early next month in China, waiting for a further reduction or reduction in interest rates.

Zheng cotton continued to shake on Friday, but it was still weak in the short term before breaking through 19200. However, the report on the planting area announced on Friday night showed that it was significantly lower than expected in March, bringing effective support to the market and the popularity of the outside market.

Today's operation suggests that light duty operation, interval operation, CF1301 reference price interval is 19300-19700.

[Huaan futures] rebound journey continues Zheng cotton oscillation market continuation

Main points: at the end of May, the cotton association of Jiangsu province contacted seven cotton monitoring spots in the whole province to investigate, summarize and analyze the cotton planting area in 2012. In 2012, the cotton planting area in the province decreased by nearly 19% compared with that in 2011.

News of the establishment of a single banking regulator in the eurozone has boosted confidence in the investment market.

External trend: New York June 29th news, cotton futures closed on Friday, and many commodities and financial markets rose simultaneously, because European leaders reached an agreement, will take measures to alleviate the European debt crisis.

Eurozone leaders have agreed to take steps to stabilize Italy and Spain's banking sector, and agree that the euro zone aid fund can be used to stabilize the bond market. Countries that have already complied with the EU budget do not have to be forced to take additional austerity measures.

As the agreement came out at the end of the season, some market participants joined in the broad rally after the fall of the cotton season this year, so as to raise profits at the last minute.

The cotton contract in December rose 2.62%, or 1.82 cents, at 71.33 cents a pound, hitting a weekly high earlier.

The volume of contracts in December was 14197, with a total turnover of 17613, representing a low of 50% over the 30 day average.

Early comment: the pattern of oversupply of cotton in the world is hard to change in the short term. According to the US Department of agriculture's June report, stocks will continue to increase at the end of next year and record high.

current

Production situation is grim, enterprises purchase cotton is not very active, downstream enterprises are more willing to import foreign low price cotton yarn to meet production needs, operation, 1301 cotton, low level first and more continue to hold cautiously, OTC funds can still bargain quantity and more single participation, stop loss near the 19000 line.