On the night of September 26, Zheng Cotton’s main contract CF2001 fell sharply to close at 12,090 yuan/ton, and the CF1911 contract fell to the intraday limit. As of today’s article, the main force of Zheng cotton has reached a new low of 12,010 yuan/ton for the year. In just one week, Zheng cotton has fallen by nearly 1,000 yuan/ton, which has once again caused a major impact on the mentality of cotton-related companies and investors. The industry has been discussing this. What is the reason for the round of decline?
Since this year, Zheng cotton futures have continued to plummet. The main reason for the decline many times is the unfavorable Sino-US economic and trade negotiations. However, this round of decline does not seem to be the leading cause of the Sino-US trade dispute. Judging from the two commodities that are more sensitive to trade disputes, soybean meal and cotton, they have shown opposite trends in the previous rounds of rise and fall, but last night they went in the same direction; and from the magnitude and trend of the decline in domestic and foreign cotton futures In comparison, ICE’s main US cotton December contract fell by 0.17 cents/pound on Thursday, with a settlement price of 60.28 cents/lb, while Zheng cotton’s main CF2001 contract opened at 12,490 yuan/ton and closed at 12,090 yuan/ton, down 405 yuan. / ton, a decrease of 3.24%.
The author believes that the “Golden September” is about to end, but the fact that the “peak season is not prosperous” will bring an end to September. There is still great pressure to destock in the domestic downstream, and the start-up situation of textile enterprises is not satisfactory. Under the premise that satisfaction and demand cannot be effectively improved, the difficulty of selling spot lint has always been a hidden danger in the market. What happens over time is that quantitative changes eventually lead to qualitative changes. It is difficult to reduce the inventory of old cotton, and new cotton has begun to be launched one after another, and the cost of new cotton this year is significantly lower than that of old cotton. Investors are expecting a decline in the cost of futures hedging. In addition, some industrial funds have recently begun to enter the market for hedging. Overall, the industry The air quality has continued to ferment intensively, regardless of the pre-holiday holiday, which may be the key to triggering the sharp decline in Zheng cotton.
In addition, judging from the current cotton production forecasts for the new year by various institutions, domestic cotton production has basically changed little from last year. It is another “good harvest year” and the industrial background of oversupply has not changed. In addition, the market has low expectations for the new round of Sino-US negotiations. The combination of negative fundamentals and bearish market mentality may be the key to the impact on the current market. </p
