Under The Influence Of The General Trend, Zheng Cotton Futures Continue To Go Down.

Since May 10th, the 1209 main contract of Zheng cotton has fallen below 20400, 20000 and 19800 of the current year.

In the United States Department of Agriculture reports of cotton bad, European debt crisis reappear and the dollar is strong, Zheng cotton fell sharply below the state's "bottom price" and short term overfall rebound, did not rule out the "sword 18000" extreme market.

It is suggested that investors should take advantage of the situation and bear in mind, not to copy the bottom.

From the perspective of supply and demand, the USDA supply and demand report once again lowered the total cotton consumption to 9 million 144 thousand and 500 tons, raised the final inventory to 5 million 351 thousand and 800 tons, and the cotton inventory consumption ratio also reached 58.52%.

At the same time, the forecast value of the end of the world cotton inventory in 2012/2013 also increased to 16 million 57 thousand tons, and the inventory consumption ratio rose to 67.1%, the highest in many years.

In addition, the national cotton market monitoring system shows that cotton consumption in China is only 8 million 849 thousand tons in 2012/2013, while the final inventory is as high as 7 million 8 thousand tons. The inventory consumption ratio is as high as 79.07%, which is about 1 million tons higher than that of the previous year. By the end of this year, even if domestic cotton production is reduced by about 15% this year, it will not have much impact on the cotton supply in the next year. The increase in the final inventory may be a major factor leading to the sharp decline of cotton futures.

As an important strategic material for national macroeconomic regulation and control, the sharp fall of cotton futures price tests the bottom line of the state's policy of purchasing and storing.

After breaking the 20400 basic price of cotton purchase and storage in the new year, market participants are doubtful about its later trend.

The author thinks that for the role of "supporting market" in the basic price of cotton purchasing and storage, investors should treat differently. Last year, the basic price of 19800 of the base price was decided by the specific environment.

Although cotton prices also fell sharply in 2011, but at the end of the year, the strength of bear power declined as the market declined. At the same time, along with the expectation of "macroeconomic policy" and "investors' expectations of the" dragon market ", the cotton price rose and went out of a relatively independent rise.

After a large number of purchase and storage and the rise of the dragon market, the sharp increase in the final inventory, the continuous decline in the textile industry climate index and the decrease in the fixed asset investment growth of the textile industry once again became a market leading factor. The cotton futures fell sharply, and the market value of the reserve price will be greatly reduced. The bottom of the so-called market will also exist in name only.

In fact, the state may not look at the decline in cotton futures prices and spot prices. Perhaps this time, the relevant departments are studying and formulating corresponding countermeasures. At present, the reduction of cotton planting area and expected output in the new year is already an indisputable fact. However, even if cotton production is reduced by 10%-20% in the next few years, it may not have much impact on the supply and demand of cotton in the next year. Due to the substantial increase in carry over stocks, the gap in the future may also be offset by cheap imports of cotton and the digestion of existing stocks.