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Cotton Brew And Rebound &Nbsp.

2011/4/23 9:57:00 54

Cotton broke down shortly after breaking through 30000 in April 11th, then accelerated down in the next few days, and once fell to a low of 27400 yuan.

Cotton price

Gradually stabilized, there are signs of a rebound.

Generally speaking, the decline of cotton in the early stage has already been larger than before, and the space of late fall has narrowed. At present, about 27800 of the price is approaching the cost price, supporting power is relatively strong, and the spot market is also facing a stalemate. I believe that a strong rebound will soon be organized.

Macroeconomic policy has been suppressed for a long time but inflation pressure has not been reduced.

In April 15th, the National Bureau of statistics released data showing that in March, the consumption price (CPI) increased by 5.383% over the new weighted figure, and by 0.207% compared with the previous month.

Consumer price

(CPI) a year-on-year increase of 5.415%, a decrease of 0.225%.

CPI rose 5% again, the highest level in China's CPI since the 08 financial crisis and hit a 32 month high.

Although the central bank announced a 0.5 percentage point increase in the deposit reserve ratio in the two days after the new statistics came out, the overall commodity market did not appear to be substantially adjusted, even on Monday, with a strong rebound in individual varieties.

At present, the country's inflation rate has not been reduced, but it has become increasingly difficult to combat. Given that the current deposit reserve rate has reached a record high of 20.5%, although the central bank governor Zhou Xiaochuan declared that there is no limit on the scope of the proposed reserve, the market reaction has shown that it is full of flavor, and that the inflation situation should not be optimistic.

Fundamental pressure has eased but output is still low.

19, the Chinese Academy of Social Sciences released the green paper on rural economy, pointing out that China's total grain output will reach 5.5 billion tons in 2011.

The cotton planting area will obviously recover, estimated to reach 5 million 500 thousand hectares, and the total cotton output can be restored to more than 6 million 500 thousand tons.

However, from the domestic supply and demand situation, the demand for cotton is still far greater than the supply.

Even without considering the weather factors and the contention factors with wheat, the output of cotton in 2011 is still far below the consumption of 10 million tons, and the gap of at least 3 million 500 thousand tons still needs to be satisfied by importing, and the dependence on foreign trade is still very large.

Although the planting area of several major cotton growers in the world has increased in 2011/2012, the yield forecast has declined.

According to the US Department of agriculture's April report, the world

Cotton inventory

Consumption ratio has dropped further, and consumption growth has outperformed production growth.

The demand for textile enterprises in the downstream is sluggish. Cotton farmers are beginning to hide their goods.

Recently, due to the large decline in cotton prices, spot prices have also seen a sharp decline. Textile enterprises are facing the dual pressure of raw materials and inventory due to their large inventory.

On the one hand, textile enterprises continue to reduce sales promotions, the market paction remains low, and finished product inventory keeps increasing. On the other hand, in the face of the declining lint price, some farmers who have higher quality seed cotton are reluctant to sell, and the cotton trading market is at a stalemate. It is believed that the cost price of cotton 27000 will bring more powerful support to cotton.

In addition, the spring special trade fair will be launched in early May. I believe that the demand for cotton will gradually increase in the later stage. Once the textile enterprises begin to stock up, the cotton price will be expected to rebound.

To sum up, after the crazy market of last year, the rise of cotton prices is justified and also supported by fundamentals. Although the fundamentals of this year have improved, there has been no change in the nature of supply.

State policies are pressing inflation and raising seed cotton purchase prices gradually, increasing farmers' confidence in planting.

We have reason to believe that in the increasingly intensified macroeconomic climate, cotton's recent decline is basically in place, and the time has come for rebounding. It is suggested that investors should take the opportunity to leave the market in advance, choose to buy at a single price, control risks and invest cautiously.