There is talk of cotton: the slow rise of cotton has begun to show

Since late December, cotton has changed from the Mustang-like strong trend for six months, maintaining a weak oscillation in the 27,000-29,000 range. From the perspective of the recent market, the spot price of cotton has shown a gradual upward trend. From December 26,900 yuan / ton to 27,500 yuan / ton, the daily gains are very limited. The price of cotton yarn showed a gradual downward trend. The C32 price index fell from 35,400 yuan/ton to 34,800 yuan/ton and began to bottom. The strength of each party was entrenched, making the market tepid and the competition between long and short sides made the profit of cotton yarn from profit of 500 yuan/ton to a loss of 500 yuan/ton. Downstream demand has been significantly weakened by the high price of cotton.

In addition, under the stimulation of the Khmer price, whether or not there will be an explosive increase in the cotton planting area in the future is also a market concern. From time to time, there were news reports that the enthusiasm for planting cotton all over the country may have brought about a recovery growth in the planting area next year.

However, in the author's opinion, in the calm of the surface, the future of cotton may also appear in the new market. In terms of planting area, I believe that the possibility of a substantial increase is not significant. Cotton cultivation is time-consuming and laborious. Due to rising labor costs, many young and middle-aged people are working outside, which is the main reason for the continuous decline of cotton planting area in recent years. For example, Henan Province, where Fujitsu has already settled, will attract about 170,000 young laborers next year. After losing these labor forces, it is difficult for the elderly people who work at home to make big changes in planting area. The situation in Other provinces is also similar. Moreover, even if the planting area increases, it does not mean that the cotton harvest is certain. The weather in the later period is also a matter of constant concern.

In addition, from the perspective of the main funds, there are clear signs of bargain hunting. As of January 4, 2011, the top ten net positions of the main force increased from 1,454 hands on December 15, 2010 to 9,213 hands, indicating that the main force has opened positions in the oscillation market. Judging from past experience, this often indicates that late cotton or cotton will have good performance.

From the perspective of supply and demand, the overall tightening of cotton supply is an indisputable fact. The author learned from the spot company that procurement is more difficult and inventory levels are not high. According to the US Department of Agriculture’s supply and demand report for December, China’s cotton supply and demand in 2011 remained a gap of 400,000 tons. Although it was less than the 1.2 million tons in 2010, the situation of supply shortage remained unchanged, and the gap was reduced due to the large amount of cotton imported from China. As well as Khmer price inhibitions based on consumption. The recent rebound in US cotton was stronger than that of Zheng Cotton. The price of imported FC Index once exceeded the 30,000 mark, and it has remained above 29,000 after the recent fall. The pressure of imported inflation still exists, making the cotton generally vulnerable to rise and fall.

Based on the above points of view, the author believes that the future cotton price may oscillate upward. It is a good strategy to take in multiple orders at a bargain and take profit at every rallies. The trend of rising prices may appear when the cotton textile enterprises start to concentrate after the Spring Festival. Before and after April, there will be plenty of caution in the bear market where hype is being resumed.