At this stage, the cotton market has continued to fluctuate for more than a month, and the upward and downward direction seems unclear. Even after the USDA May monthly report announced positive news yesterday, domestic and foreign cotton prices have not improved much. The market is still divided on whether consumption will recover as expected in the future.
Yesterday, USDA released its monthly report for May. The content was obviously bullish, but the market response was very dull. Cotton prices at home and abroad continued to fluctuate. Among them, US cotton showed a slight correction after continuous rises. Zheng cotton still It remains volatile, especially since the report significantly raised global cotton consumption data by nearly 11%, which is surprising. When the number of confirmed cases of the global epidemic has exceeded the 4.1 million mark, and the road to fighting the epidemic is still far away, the sharp increase in consumption data is inevitably full of doubts. Market professionals believe that this is a common trick of the USDA to ensure better returns for US cotton exports. It is not worth making a fuss about. However, it also shows that with the emergence of good news, cotton prices still have a mediocre response and market pressure still exists.
According to statistics from the General Administration of Customs of China, from January to April 2020, my country’s cumulative export volume of textiles and clothing was US$66.620 billion, a year-on-year decrease of 12.06%, of which the cumulative export volume of clothing was US$29.3089 billion, a year-on-year decrease of 12.06%. It fell by 22.33%, which was higher than the first quarter.
Judging from the clothing export data, although my country’s epidemic was under control in April and social production and business activities gradually got back on track, my country’s clothing exports are facing great pressure due to the continued impact of foreign epidemics. Looking back at the domestic consumer market, although the relevant departments have recently released a series of data, showing an improvement in the situation, the textile and clothing market is still “under great pressure” and the recovery speed is slower than other industries.
The recent emergence of some well-known fast-moving consumer clothing brands reducing the number of stores and drastically laying off employees also proves that the textile and apparel consumer market is still in trouble.
Of course, the recent extreme weather such as hail in Xinjiang has also given support to cotton prices. Some cotton fields have been seriously damaged and need to be replanted or resowed in a timely manner. Cotton entering the growth period needs suitable growing weather during the budding, flowering and bolling stages. Any extreme weather during these periods will have an impact on cotton yield and quality. Therefore, when entering the period of rising weather conditions, cotton prices naturally performed strongly. However, the influence of this factor on cotton prices will gradually decrease. According to the changes in Xinjiang’s output in recent years, unless a particularly large natural disaster occurs, Xinjiang’s output data generally fluctuates within 5% (because Xinjiang’s annual output There will be extreme weather (large or small), which has a limited actual effect on prices.
While cotton prices have not yet found their direction, the market continues to fluctuate. As long as the epidemic is not fundamentally controlled, it will take a long time for the consumer market to recover, and the probability of a “V-shaped” rebound will only become lower and lower. . </p
