According to SunSirs statistics, as of May 19, the average Chinese lint cotton spot market price was reported at 11,559 yuan / ton, up 0.1% from last Tuesday and down by 22.73% year-on-year. Due to the recent use of national power by the United States to suppress certain enterprises in other countries under the pretext of national security, China has indicated that necessary measures will be taken to safeguard the legitimate rights and interests of Chinese enterprises. During the past weekend, Sino-US trade relations became the focus of market attention, the ICE July cotton contract closed down 0.45 cents on Monday, or 0.77%. Zhengzhou cotton’s main ups and downs were extremely poor, reaching 320 yuan / ton, closing up 65 yuan / ton or 0.56%.
Last week, the spokesperson of the Chinese Ministry of Commerce stated that the United States has used various excuses and abused export control measures to continue to suppress certain enterprises in other countries, undermining market principles and fair competition, it is a serious threat to the security of the global industrial chain supply chain. China urges the US to immediately stop wrong practices and will take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises. Earlier on May 8, the leaders of the high-level consultations on China-US economic and trade talked with each other and stated that they should strengthen macroeconomic and public health cooperation and strive to create a favorable atmosphere and conditions for the implementation of the first phase of China-US economic and trade agreement. However, the US's approach and China's determination to respond have caused the market to worry about the smooth economic and trade cooperation between the two countries.
According to the latest US cotton export data, from May 1-7, China continued to sign a large number of US cotton, with a new contract volume of 44,900 tons, (and a new increase of 1,247 tons in Taiwan China), accounting for 85.46% US cotton exports in the week. From the data point of view, China signed a contract with US cotton for more than 40,000 tons for three consecutive weeks, supporting the increase in cotton prices, but the uncertainty of Sino-US relations, cotton price increases are limited, analysts believe that with the gradual recovery of textile recovery, the dark era has passed, the cotton market will usher in a warm season, but the road of rising will not be smooth.
The downstream demand for cotton yarn is generally supported, and yarn prices are generally lowered. In the early part of the year, the Pakistani yarn factory resumed work, and the yarn output increased. Although the yarn factory started production, the downstream enterprises were relatively difficult to start, and there was no matching production and sales. The price of Pakistan yarn fell. As of May 13, 30 carded yarns were exported. The quoted price for the week was US $ 2.50 / kg, a decrease of 4.58%, and a decrease of 12.28% within a month. Indian yarn continued its downward trend in early May, with 30-count knitting yarn falling 8% in three months, and the USDA expects India ’s cotton consumption to decrease by 15% this year. As of May 19th, the price of 32S high-purity cotton yarn in Shandong was reported at 21,250 yuan / ton, down 2.86% from the beginning of the month.
In April, the domestic lint spot fluctuated between 11,000-11,550 yuan / ton. As of May 19, the cotton price activity range for May was 11,400-11,600 yuan / ton. Compared with April, the trough has increased, the amplitude has shrunk, the cotton price average has risen, the market stability has improved, and the driving force for cotton price increases has weakened. SunSirs analysts believe that due to uncertainties in the renewal of Sino-US trade relations, the rise in cotton prices is difficult. Zhengzhou cotton rushed to 11,905 yuan / ton on the day, and then quickly fell back. Some analysts expect Zhengzhou cotton to be difficult to break through the 10,000 mark in 11,200 -12,000 yuan / ton shock.
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