Cotton Prices Rose Slightly In Early August

According to the statistics of the business agency, as of August 11, the average price of domestic lint spot market was 12422 yuan / ton, up 82 yuan / ton or 0.66% compared with the beginning of August, and 8.77% lower than last year. Drought and hurricane helped us cotton rise sharply, the contradiction between production and demand was alleviated, and cotton prices rose sharply. However, some recent remarks by the president of the United States have made the market worry about the follow-up trend of Sino US trade again, which may lead to a sharp decline in ice cotton last Friday.

Before this, dry weather in Dezhou reduced the excellent rate of local American cotton, and the yield was also damaged. At the end of July, hurricane Hannah hit southern Texas. According to the preliminary estimation of local experts, 100% of the new cotton with cracked bolls and bolls has been damaged, and the new cotton has been affected by gale, flood and soil pollution. It is estimated that the hurricane will reduce the local cotton production by 300000 bales or more.

The international cotton market will enter 2020 / 21 from August. According to the global cotton production and demand forecast released by the International Cotton Advisory Committee (ICAC) on July 1, 2020, the global cotton production will be 24.86 million tons, with a year-on-year decrease of 1.29 million tons, and the consumption will be 23.31 million tons, with a year-on-year increase of 770000 tons. From 3.65 million tons to 2.15 million tons in 2020, the annual output will be reduced by more than 1.55 million tons.

The number of American cotton contracts in the new year has increased greatly. According to the latest US cotton weekly report, the contracted net export volume of upland cotton of the United States in 2020 / 21 is 29700 tons, and the buyers are China (10600 tons), Vietnam (5012 tons), Indonesia (2948 tons), Bangladesh (2495 tons) and Pakistan (1860 tons).

According to the latest customs data, textile exports have improved. In July 2020, China's textile and clothing export volume was 31.294 billion US dollars, with a month on month increase of 7.79%. Textile exports increased by US $15.397 billion, representing a decrease of US $15.397 billion.

However, it can not be ignored that compared with the downstream demand in previous years, cotton inventory pressure in many ports is increasing. According to the feedback of import cotton traders, in the late July, the cotton outside the port was in a state of "more storage and less shipment", and the pressure on the port warehouse increased. According to the inventory statistics and estimates of several international cotton merchants and large-scale import enterprises, by the end of July, bonded + non bonded cotton stocks in China's main ports will reach 580000-600000 tons again.

Price changes of cotton yarn at home and abroad from August 3 to 7, 2020

(data source: national cotton market monitoring system, China Cotton network)

From last week's cotton yarn price trend, cotton yarn price is still falling, contrary to the trend of cotton. Yarn and cotton prices continue to fall. Among them, the price of cotton yarn in Vietnam and Indonesia is the most obvious, and the price difference between China and foreign countries is widening. According to relevant statistical data, in 2020, the net import volume of cotton yarn will be 129500 tons, with a month on month increase of 49.53%, and a year-on-year increase of 8.78%. The pressure on domestic yarn delivery will increase. According to the statistics of the business agency, as of August 11, the price of high-end knitting ring spinning 32S cotton yarn in Shandong was 20125 yuan / ton, down 0.37% compared with the beginning of August, and 10.56% lower than the same period last year.

On Friday, the news of cotton price reduction between China and the United States is slow, which can stimulate the cotton market to go up. Cotton price rise is expected to be limited, a small correction.