Shortage of Cotton Supply Global cotton prices have to fly for a while

The price of cotton futures soared by more than 10,000 yuan per ton last year, and cotton yarn rose by more than 15,000 yuan per ton. Recently, due to a series of news about China's purchases in the United States, India's non-increasing exports, and continuous rainstorms in Australia, Zheng Cotton went out of Wuyang, and last Friday, Zheng Cotton 1109 once again stood at 30,000 yuan, increasing its holdings from 25,794 hands to 273,588 hands. .

The cotton market is about the lives of the people. Will this year's cotton make another big wave? The industry believes that the shortage of cotton supply coupled with weather factors provide opportunities for capital speculation. This year, the possibility of high cotton innovation is high.

Cotton foreign dependence more than 30%

He Zhuoqiao, an analyst at China Merchants Futures, said that cotton supply is tight at home and abroad. The world's three major cotton producing countries: China accounts for about 1/4 of global production, India also accounts for about 1/4, and the United States accounts for about 18% of global production.

From 2009 to 2010, Indian cotton increased slightly. However, due to the serious inflation in India, the country tightened its cotton exports. From August 2010 to August 2011, India’s cotton export quota was further reduced to 500 kcal (21 kilograms for 1 kilogram).

Global cotton stocks were 55% higher from August 2008 to August 2009, and from August 2009 to August 2010 dropped to 36.99%. From August 2010 to August 2011, this figure is expected to further reduce.

China is the largest country in cotton production and demand. However, there has been a clear shortage of cotton supply in the past two years. According to the report of the Cotton Research Institute of the Chinese Academy of Agricultural Sciences on January 14, China's cotton production in 2010 decreased by 14.6% from the previous year to 5.7 million tons.

According to the latest statistics from the General Administration of Customs, China's cumulative import of cotton reached 2.837 million tons in 2010, an increase of 13.11 million tons, an increase of 86%.

He Zhuoqiao introduced that China's cotton imports accounted for almost 50% of the total cotton output last year. This year, China’s cotton import quota has increased to 3.2 million tons. The external dependence of China's cotton has exceeded 30%.

The shortage of supply coupled with the proliferation of global liquidity, the global soft goods such as cotton, sugar, and coffee have become the focus of funding speculation last year, and prices have risen sharply. Before September last year, the domestic cotton futures price was 19,000 yuan/ton, which was rapidly increased. In November, the highest level hit a record of 33,600 yuan/ton. During the same period, 32 domestic cotton carded yarns rose from 26,000 yuan/ton to 43,000 yuan/ton. In early September last year, the price of US cotton was less than 90 cents/lb to a maximum of 159 US dollars/lb. The increase in such a short period of time is so great that the industry is amazed.

La Nina caused a decrease in cotton production this year affected by La Nina. The Australian flood affected the main cotton producing areas. The Australian Cotton Planting Association estimates that the Australian cotton production will be reduced by about 10%, which will lead to a reduction in exports of Australian cotton.

CSI Futures analyst Wang Congying analyzed that this year, the world's exportable cotton is expected to reach 8 million tons, of which 3.2 million tons will be able to meet China's imports. This year, the pattern of shortage of cotton is hard to change.

Prior to the first quarter, the cotton or innovation high Hezhuo Qiao said that the cotton planting area this year will be clear after the first quarter. Cotton will be further speculated before the first quarter, the highest price of cotton can be seen at 35,000 yuan / ton. Therefore, cotton can be seen before April this year. He believes that as long as the sown area is determined, the impact of late weather factors on cotton will not be too great.

Wang Congying said that the focus of this year's cotton price will be shifted upwards as well as sugar, and cotton prices will have a chance to hit new heights. However, He Zhuoqiao believes that due to the historical record of cotton prices, China's cotton planting area may increase by 10% this year. After April, cotton prices will slowly decline and stabilize in the range of 24,000 yuan/ton to 25,000 yuan/ton. He said that downstream cotton production companies should adapt to the era of high cotton prices. Both analysts remind investors that this year should pay particular attention to the contraction of national monetary policy, which will directly curb the speculative strength of funds.

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