Downturn In &Nbsp; Cotton "Hidden"?

Recently, around the uncertainty of macro environment, market sentiment has changed rapidly to most bulk.

Behind the calm market performance,

The external macro situation is changing.

Over the past two months, the European debt issue, which has continued to pay attention to the market, has reached a framework agreement which is better than expected from the two summit of the European Union in October 26th. The following focus should be shifted to the details of the implementation of the agreement, and whether China's emerging economies, such as emerging economies, will be able to handle the rescue, which can focus on this week's G20 summit, which may involve market confidence.

In addition, the main line of concern to the macro level should be shifted to the US and China's monetary policy. At present, Australia has cut interest rates and Brazil has cut interest rates for the two time. China has also revealed policy fine-tuning through various channels. Whether the United States will make a clear statement at the recent conference on interest rates may have a far-reaching impact on the market.

Downstream consumption of cotton is still not good.

From 4 and May of 2011, the downstream consumption of cotton was poor, especially the high inventory of yarn and cloth, which led to a long period of weak adjustment of cotton prices until now.

The market generally believes that if there is no support for the reserve price, cotton prices will probably return to the origin of the market in 2010.

Judging from the current market situation, the downstream consumer market is still not effectively improved, and the order reduction may exceed 30% in the same period. The enterprises are still watching the cotton market in a cold shoulder, and are not eager to replenish their stocks.

Even though the industrial stock of textile enterprises may have dropped to a relatively low level for several months, even a large textile enterprise in Shandong has reduced the price of grade 3 cotton to 300 yuan to 19500 yuan, which is lower than the state's purchasing and storage price.

The three phase of the Canton Fair, which began in October 31st, also did not pass too much good, which restricted the rise of cotton prices.

In the case of downstream consumption has not yet opened up, whether there is any possibility of worsening in the future market, or there are some turning points that need attention.

Collection and storage increasingly active

The macro level and the downstream consumption of cotton are weak.

Considering that the cotton farmers' satisfaction has generally declined this year, cotton planting enthusiasm may be cooling down in the coming year. It is expected that the state will further introduce the policy of purchasing and storing prices in March next year, and keep the cotton price stable at a certain level, while maintaining the most basic business profits of the enterprises in the industry.

To sum up, the macro and downstream consumption basically face the heavy pressure of the cotton futures market, which is still an unavoidable topic. It will also suppress the rebound of the cotton market for a long time later this year.

However, the determination of state purchase and storage price, to a certain extent, has blocked the further decline of prices, and has established a pattern of sexual intercourse in the cotton stage. In the later stage, we need to pay attention to the change of positions in the early empty seats.

From the perspective of the long-term healthy development of the cotton industry chain, there will be some fluctuation space above the market fluctuation interval after the effective determination is made. One thousand or two thousand points do not seem to be excessive.