Cotton City Cost Pressure Pressure Downstream, ICE Cotton Will Take The Lead

It is understood that in late June

Futures, national cotton auction bid price, cotton spot prices rose sharply, the cotton yarn operators in Guangdong, Zhejiang, Jiangsu and other places have reduced or even stopped picking up and purchasing from cotton mills in order to avoid risks and reduce funds. OE10S-OE21S, C21S-C40S yarn inquiry and paction were significantly cooler than in May and June.

Traders said that on the one hand, the price of cotton yarn of C40S and below in some cotton mills increased by 400-500 yuan / ton, and some large factories even reported 800-1000 yuan / ton, but the downstream intermediaries and weaving mills were not strong in digestion. The difficulty of negotiating yarn prices increased. Traders worried about riding the tiger. On the other hand, cotton textile mills, garment enterprises and foreign trade companies had strong expectations for the recent state departments concerned to increase cotton supply. Once cotton prices fluctuated in July, Cotton Traders rushed to order.

Cotton mills in Henan, Hubei and other places analyzed that the cost pressure of cotton raw materials rising sharply has been gradually pferred to yarn, cloth and clothing recently. However, compared with Zhengzhou cotton contract CF1701 and national cotton store price, the price of cotton yarn rose only 500-1000 yuan / ton (actually 300-800 yuan / ton) in the short 20 days up to 2690 yuan / ton and 1913 yuan / ton respectively.

A 50 thousand cotton mill in Henan reflects the increase in bid price of national cotton auction.

Gao Kai Gao, 2015/16 cotton spot quotes rose more exaggerated, spinning C21S, C32S, C40S yarn not only did not profit, but there is a loss of 500-1000 yuan / ton, spinning enterprises to complete orders, can only increase the price from the hands of traders competing for national cotton, virtually raised.

If we want to jump out of this strange circle, we can only postpone delivery or terminate the contract if there is only one way to cut down production and stop production.

Some agencies and media speculate that the medium and long term rise of cotton has been opened, and the price of cotton yarn, grey cloth, clothing and foreign trade contract will gradually become logical. The problem of poor industrial chain pmission will soon be cleared.

It is the pressure of China's economic data to stabilize and the cotton consumption will enter the off-season after the peak season in 3-6. The two is not only the EU's economic and stability variables are increasing, but also the Federal Reserve may take the opportunity to raise interest rates, and the way of commodity rebound is very long. Three, it is the speculators' use of funds to storm the storm and cause the real economy of cotton processing enterprises and cotton mills to be severely damaged. The crisis is fundamental to the whole national economy and the state can not sit idly by. The government of India will also introduce measures to suppress speculation so that cotton prices can return to orbit. Four, at present, the US cotton is growing well, and Australia cotton has also entered the Chinese market in a large scale. Brazil cotton, which is "cheap but not cheap", has become the focus of attention of Chinese textile enterprises. I do not agree with this view.

In addition, the key factor that affects Zheng cotton is the timing of speculative capital selection and profit escapes at any price. It is estimated that ICE cotton will take the lead in the first downturn.

Key words: futures paction price