Cotton City Was Unfinished Waiting For Policy Adjustment

"Disaster" is not a single line. Every time the bad news spread out on the macro side, Zheng cotton futures market can not escape the two consecutive heavy blow. As shown in Figure 1, the price of less than half a year has touched 6 limit, and the intraday price of 12075 is below the 3 year low. How are the fundamentals in the face of macroeconomic factors?

Fig. 1 the closing price chart of zhengmian main company

According to my agricultural product network, the production and operation of downstream textile enterprises are basically in deep water. The demand for terminal consumer market is very low. In addition to a large number of textile enterprises selling more products and orders, the majority of spinning enterprises are scarce, and the start-up rate is relatively low for a long time. Most of the smaller factories have not resumed their operation since June. As shown in Figure 2, according to the statistics of my agricultural products network, as of August 9th, the yarn stock of textile enterprises in the main regions of the country was 28.7 days, 0.9 days more than last week, and the inventory ring ratio continued to maintain an upward trend. In Hebei, Xinjiang and Fujian, the yarn stock inventory days of textile enterprises increased considerably, and the stocks in Shandong, Henan and Jiangsu and Zhejiang provinces increased slightly.

The cotton business inventory in China has gradually decreased. However, from the statistics of the association in recent months, the decline in inventories has narrowed compared with the same quarter of the year, and under the condition of market uncertainty and expected bias, textile enterprise procurement has become more cautious. In recent years, due to the demand gap, China's cotton imports have maintained a growth trend. The author believes that although the domestic cotton spinning capacity is huge, it is now very superficial. With the rise of the alternative market, the transfer of cotton textile industry to foreign countries, and the loss of foreign trade orders, the domestic cotton consumption has been cut off by a big knife. According to the analysis of the data combination, consumption in 2019 is expected to drop by more than 1 million tons, and the gap between production and demand will gradually shrink.

According to my agricultural product network, there are still a certain number of 2017/18 cotton in the market. I understand that some of the resources are ordered by the mainland textile enterprises. After the market weakened, the factory funds problems, and finally failed to actually clinch a deal. There is a great pressure on the inventory of the regulatory libraries within the territory, and some of the cotton enterprises are relatively slow in sales. As the loan period of the agricultural development bank is approaching, there is a phenomenon of selling at the end of July, and the overall turnover has been made. But then, because of the worsening of the macro market, the market has evolved into a price free market trend, and some enterprises have suspended the offer again. Zheng Mian Lian has changed its monthly contract to CF2001. As of August 9th, the number of warehouse receipts was 12879, and 1400 effective forecasts. Therefore, the overall supply side is characterized by adequate quantity and slow delivery.

The low demand has become a long-term and difficult problem in the market. The prices of raw materials and finished products have continued to decline. Most industrial enterprises have already been in a state of losing money, but the market is deteriorating because of the market transaction mentality. Autumn and solar terms have passed, textile and garment industry will usher in seasonal consumption, but in the last month of -2018/19 in August, the domestic cotton market has been unfinished or has been foregone conclusion. 2019/20 seed price and seed cotton sale progress have been ignored by most market people. The market self-regulation ability has been weakened.