Zheng Cotton'S Center Of Gravity Moves Slowly Upward, Supply And Demand Are Not Smooth, Short-Term Restrictions Increase.

Zheng cotton main CF1909 contract since December 25, 2018 hit 15080 yuan / ton low after the shock slowly upward.

A series of economic stimulus measures such as lowering demand, reducing taxes and lowering fees and so on have made a good contribution to the whole cotton industry chain. The market confidence has been boosted by the good progress of Sino US economic and trade consultations.

China and the United States have lowered the estimated cotton planting area in the new year, and cotton prices in India continue to rise.

There may also be weather rise during the cotton growing period in the main producing country.

On the whole, the space beneath the cotton is relatively limited.

However, short-term supply side is abundant, demand side is still weak, and supply and demand pmission is not smooth or will restrict the increase of Zheng cotton price.

China's cotton picking, sale and processing basically ended in 2018, and is now in the stage of pure consumption.

The national cotton sales rate is less than that of the same period last year.

Domestic cotton industry and Commerce stocks moved slowly down, but as of the end of March, they were still 27.75% higher than the same period last year.

Since December 2018 to March this year, the total volume of industrial and commercial inventories has decreased by 823 thousand and 600 tons, down 76 thousand and 700 tons compared with the same period last year.

In April, the domestic cotton yarn utilization rate and the cotton grey fabric utilization rate were lower than that of the same period last year.

Grey fabric is slow, yarn price is weakening, cotton industry chain spring season is not obvious.

On the other hand, in the lower overall profit of cotton industry chain, we should give priority to the use of medium and low price cotton with high cost performance.

At present, the price of cotton in the mainland is slightly weaker, and the quality of cotton in South Xinjiang is good, but the cost is high.

Domestic cotton spot prices continue to rise, while the downward price of yarn is weakening, the price of grey cloth is stable, or from the side confirms that the proportion of high-quality cotton in China is increasing, and the number of low-quality cotton is decreasing.

The import quota for this year was announced earlier than last year, and the import volume of low price imported cotton is expected to increase, which will impact domestic cotton prices.

However, in contrast with the international cotton market, the US cotton trend was stronger than that of Zheng cotton for a while, and the internal and external spreads narrowed.

India's domestic cotton supply and demand is tight, cotton prices continue to rise, and imports of US cotton have also increased.

On the whole, the cost of imported cotton has increased.

The supply and demand of cotton is not smooth. Some of the high quality cotton is registered as a warehouse receipt by a cotton mill and traders to expand sales channels and get quality premium.

As of April 19th, the number of warehouse receipts was 18430, and the effective forecast reached 4534. Zheng cotton warehouse receipt + effective forecast reached 22836, equivalent to 913 thousand and 400 tons, and 147% higher than the same period last year.

On the whole, the March macro data is good and the optimistic expectation of Sino US trade negotiations boosted market confidence.

The cost of imported cotton has risen as a whole, and there may be a weather rise in the cotton growing period of the main producing country.

The policy of increasing the import quota of 800 thousand tons of cotton fell to the ground. The increase in the import price of the low price cotton is expected to be strengthened, which limits the increase of zhengmian disk.

Follow up needs to pay attention to the policy of reserve cotton, the distribution of import quotas and the impact of the quantity of imported cotton on the disk price.