August 21, 2012 Institutional Watch - Cotton Futures

[Hongyuan

Main points

1. Price Bulletin: domestic lint: 129 level 20294 yuan / ton; 229 level 19436 yuan / ton; 328 level 18524 yuan / ton; 428 grade 17617 yuan / ton.

Domestic textiles: polyester staple fiber 9730 yuan / ton; viscose staple fiber 15050 yuan / ton; C32S price 25380 yuan / ton.

2. domestic spot: the domestic cotton spot price is running smoothly. Recently, the market hopes that the cotton price will be increased by the speculation weather and policy factors. However, the situation of oversupply of cotton market is difficult to change. This also determines that it is difficult to have a big rise after that, and the price of textile enterprises is weak and the price is rising.

3. imported cotton: in August 16th, the price of China's main port of imported cotton rose again, of which the US cotton rose 1 cents and the West African cotton rose 0.5 cents.

In fact, spot trading is not large, mainly by spot shipment, and the market supply pressure has not been alleviated. At the same time, there are bad news such as precipitation in the main cotton producing areas of the United States. Therefore, the price of foreign cotton is very limited.

4. growth stands: nearly one Zhou Yilai (August 10-16), the domestic real estate cotton area generally appear rainfall, the growth of cotton to varying degrees.

Among them, the cotton fields in the the Yellow River River Basin were wet, and there were accumulated water in some plots. The cotton plants lodged, and the yield per unit area of seed cotton would be reduced by 5-10%. Therefore, the cotton farmers' purchase price for seed cotton is expected to increase at 5 yuan / Jin.

5.ICE cotton: in August 20th, China's main port price of imported cotton generally rose by 0.5-0.7 cents.

Although China's cotton imports once again exceeded 400 thousand tons in July, cotton imports in 2012/13 will not exceed that of the previous year. No matter from actual demand or from policy regulation, China's cotton imports can hardly be reproduced brilliantly.

Summary:

The two major factors that affect domestic cotton prices are demand and policy. There is no substantial change in demand.

With the approaching of the new cotton year, the policy will become the primary factor affecting cotton prices in the short and medium term. Cotton enterprises expect cotton prices to come closer to the purchase and storage price. Under this expectation, there is limited space under zhengmian.

I insist that the central line of Zheng cotton fall back gradually into many single ideas unchanged.

Wanda futures] US cotton continues to rebound with its peripheral products.

Although the crop growth report released by the US Department of agriculture showed improvement in crop grades, the market did not respond to this. The US soybean, corn and wheat continued to rise to stimulate the market's popularity. The ICE cotton continued to rise under speculative buying support. The December contract closed up 1.53 cents to 74.83 cents / pound, and the highest price to 75.31 cents / pound in the market. Cotton prices are expected to challenge the pressure point of 77.07 cents / pound of the previous rally. It is expected that in the support of the strong external market, the ICE cotton will ignore the underlying factors and maintain the rising pattern, such as cotton prices break 77 cents / pound, rebound point pressure, and the upward goal will reach 83 cents / pound.

Monday ICE

Zhongyang closed, the main contract in December is still stable above the short-term average, although it is still suppressed by 75 cents / pound, but the short term average line has a trend of continuous upward trend. The KD and MACD indicators have been bonded to form a trend of rising trend, MACD index red column growth, and the rebound trend has not changed. In December, the contract will challenge the pressure of 77.07 cents / pound in the early rebound.

There has been no progress in China's rumours of dumping and storage. The resources of the spot market in the end of the year are tight. The price of India cotton has already reached 18700 yuan / ton. At the same time, the new year is coming. The Chinese government will open the stock market at a price of 20400 yuan / ton, which leads to the rebound of domestic and future cotton prices.

However, as the euro area economy continues to decline, textile and clothing consumption continues to shrink, and textile enterprises have limited price bearing capacity, which has become the main factor restricting the rebound of cotton prices.

In this case, Zheng cotton will follow the ICE cotton continue to rebound pattern, the 1301 contract has 20400 yuan / ton storage price close to the trend, but the lack of consumption, capital and popularity support, the rebound is not coke view, cautious bullish is appropriate, pay attention to 1301 contract 19700 yuan / ton pressure level, if effective breakthrough can continue to hold more single, otherwise the pressure will rely on the pressure to make more profit, the backhand increase of empty single, the target 19400 yuan / ton line.

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[MEIKO futures] market sentiment slightly improved, Zheng cotton is expected to build a complex bottom.

Overnight, in August 20th, as the price of agricultural products rose, ICE cotton futures opened higher and higher. The 10 day average line broke into the market, triggering more technical buying, and the contract rose 153 points in December.

However, at the moment, the US cotton industry is growing well, with an excellent and good rate of 41%, compared with only 31% last year, and the spot market is not active enough to limit cotton prices.

On the news side, the rainfall in Gujarat in India has finally been strengthened, but some parts of the country still lack enough rainfall, and the cotton output in this area accounts for 65% of the total in Gujarat.

This year, the area of cotton planting in Gujarat is 33 million 600 thousand mu, and the area last year is 43 million 500 thousand mu.

Local newspapers in India say the Prime Minister of India will hold a cabinet meeting to formulate a cotton export policy to ensure the cotton demand of domestic textile mills in the new year.

In the international market, in August 20th, the price of China's main cotton imports rose by 0.5-0.7 cents.

Although China's cotton imports once again exceeded 400 thousand tons in July, cotton imports in 2012/13 will not exceed that of the previous year. No matter from actual demand or from policy regulation, China's cotton imports can hardly be reproduced brilliantly.

In the new year's global supply continues to increase, the procurement of textile enterprises will be more cautious.

Domestic market, 20 days, through a slight rise in a period of time, domestic cotton spot prices for the first time dropped slightly, the textile downstream market consumption is still the main reason to suppress cotton prices, but the new cotton year domestic natural disasters on the cotton production impact, and the state purchase and storage is approaching, the slight fall will not affect the cotton price upward trend in the future.

Spot quotation, August 20th, the US C/A cotton quotation is 89.05 (cents / pound), the discount general trade port delivery price is 15269 yuan / ton (calculated by sliding tax), Australia cotton 94.30, discount general trade port delivery price 15961 yuan / ton; Uzbekistan 91.60, discount general trade port delivery price 15600 yuan / ton; West Africa cotton 87.60, discount general trade port delivery price 15086 yuan / ton; India cotton 85.10, discount general trade port delivery price 14775 yuan / ton.

National cotton price A index 19445 yuan / ton, down 2 yuan; B index 18532 yuan, down 1 yuan.

Market analysis, the current only ten days from the new year, the state will be 20400 unlimited storage, and the supply of high-grade cotton increasingly tense, cotton prices have been supported.

But the fundamentals have not changed much.

The affordability of high cotton prices is limited.

Yesterday, CF1301 opened slightly in the afternoon and stretched slightly. The center of gravity of the daily line gradually increased, and the price was approaching 19700 on the interval. It is expected to build a complex double bottom, but at the same time, the resistance at the top 19700 is still obvious.