Market Observation: ICE US Cotton Fell, China'S Cotton Price Index Fluctuated

On Wednesday, ICE American Cotton fell 0.74% to close at 67.16 cents/pound, and CF505 fell 0.37% to close at 13610 yuan/ton. The arrival price of cotton in Xinjiang was 14531 yuan/ton, down 4 yuan/ton from the previous day. China's cotton price index of 3128B was 14810 yuan/ton, up 5 yuan/ton from the previous day.

　 International market:

The market pays more attention to the policy changes after Trump took office. The recent price drive of American cotton is more at the macro level. The marginal changes in fundamentals are limited, and American cotton operates at a low level.

After grain prices rose in Chicago, cotton is trying to rebound, but concerns about producers limit the rise, and cotton also lacks speculative buying power.

Domestic market:

Yesterday, Zheng Mian still maintained the trend of shock operation. The driving force of fundamentals was limited. As the Spring Festival holiday approached, textile enterprises continued to have holidays, and the start-up load dropped significantly. It was expected that the cotton price would run smoothly before the festival, and attention should be paid to the risk of positions.

Textile enterprises have more holidays, and cotton yarn market transactions are further light. As the Spring Festival holiday approaches, cotton yarn spot market prices show signs of a slight decline, and most enterprises are not optimistic about the post holiday market.

　　 Market future:

On the one hand, Trump requires to levy a 10% tariff on Chinese goods. On the other hand, under the loose cotton supply pattern, cotton consumption is weak, and textile enterprises purchase lint on demand, which lacks strong support for cotton. It is expected that the cotton market will remain weak and volatile before the festival. In the short term, attention will be paid to the support of Zheng Mian at 13500 yuan. Once it fails, Zheng Mian will fall to around 13300 yuan.