Agreement Is Reached Between China And The United States That High Cotton Prices Will Have Potential And Opportunity In Summer.

In July 2nd, ICE futures reversed the day before yesterday, and the market continued to have high expectations for reaching agreement between China and the United States. Moreover, at the G20 summit last weekend, Xi Jinping made it clear that China will buy large quantities of US agricultural products. Therefore, the market also expects China to start buying large quantities of cotton.

According to the latest report of the US Department of agriculture, last week, 52% of new cotton in the United States grew well, with an increase of 2 percentage points, but the proportion of poor seedlings was 18%. The ratio increased by 1 percentage points. The proportion of good seedlings was nearly 55% over the past ten years, and the proportion of poor seedlings was 19%.

Technically, ICE futures are moving downwards, but the current trend is also beginning to face challenges. Most traders believe that the best description of the bear market is to continue to refresh the low price, while the high point of the recovery increases. However, once the lower heights of the early stage are broken, not only will the technical graphics change, but also the mindset of the empty will change. Even after this Easter high point this year, the ICE futures contract in December has been hitting a low price and rising to a high level. At present, due to the huge number of speculative empty bears, the number of people who oppose the high price will continue to decline significantly, so cotton prices have potential and opportunity in the summer. Time will tell.

In July 2nd, ICE futures fluctuated in the range of 2 cents, and eventually the contract reached 70 points in December, and the market did not have a clear direction. In addition to Sino US trade negotiations, cotton fundamentals are also likely to create opportunities for stabilizing or rising cotton prices, one of which is the serious lack of rainfall in the cotton producing areas of India, which has become a hot topic in the media and has attracted the attention of the industry.

July 4th is the independence day of the United States, ICE futures will be closed for a day, and the US cotton export weekly will be postponed one day. Recent market transactions are relatively dull, and prices may continue to swing.