Where does the cotton in the turmoil go?

Business News Agency September 25th Cotton has been oscillating narrowly in this region for about 2 months. There are countries under the limit of unlimited storage reserves, there are a lot of selling pressure above the top, plus the spot downturn. Cotton can only fluctuate within this narrow space.

New cotton has been continuously listed, seed cotton purchase price at 4.2 yuan / kg or so, is expected to increase production this year, 12% over last year, business orders less than in previous years. Cotton yarn stocks are still very large, and cash suppliers still have some old cotton in their hands. All this seems to indicate that it is impossible for cotton to rise. It is only that the country holds the bottom and will die.

The author thinks it is not entirely natural.

The country's 19800 collection and storage price is strictly measured, including the cost of cotton cultivation, processing costs, domestic demand, and the entire industrial chain. In other words, it is unlikely that cotton will fall below this price in the next few years. This is the lowest price.

From the perspective of this year's new cotton, cotton farmers are reluctant to sell their products. According to the author's understanding, even if the purchase price of seed cotton is 5 yuan/kg, the yield of growing cotton is not as good as growing other crops such as corn.

This year's cotton production increased by 12% from last year. The reason is that the high price of spot cotton last year stimulated the cultivation enthusiasm of cotton farmers. The cotton-wounded farmer hurts the farmers, and the author believes that the planting area and production of cotton will be much reduced this year.

The treasury can hold 3.6 million tons of cotton, which accounts for nearly 50% of the national output. The author believes that the country can receive a large amount of cotton this year, which will result in a reduction of the cotton circulating in the market.

There are many spot dealers complaining that exports will not work, and now the use of polyester will increase rapidly. The author believes that due to the demand of Europe and the United States and domestic adjustment structure, demand will gradually shift to the domestic. At the same time, as cotton textiles, it is impossible to use polyester, cotton is always used, and the use ratio of cotton will be gradually reduced, but the comfort of cotton is irreplaceable for polyester.

In the case of a large number of cotton stocks and the country’s monetary policy is not relaxed, it is difficult for cotton to start rising prices. However, the author believes that once the acquisition of cotton is over and the country relaxes its monetary policy, it will be the day for cotton to rise again. From another point of view, the state's purchasing and storage has always been purchased at the lowest point, and it is stored at the highest point. In summary, the author believes that cotton will most likely start to rise at the end of this year or early next year, and 25,000 will see it again, only a matter of time.