On February 26, ICE cotton futures continued to fall. The market became more worried about the continued spread of the new coronavirus epidemic, and there were very few new bulls entering the market. On Tuesday, U.S. Centers for Disease Control and Prevention officials said it was not a question of if, but when the novel coronavirus would fully spread to the United States. Although this wording is cautious, people are still scared away from the normal rhythm of life. Therefore, the U.S. economy may fall into a downturn, and clothing consumption will naturally be included.
On the same day, the cotton market continued to fall, with the Dow Jones index’s early trading range reaching 500 points, discouraging potential buyers in many markets. ICE futures continued to close lower amid concerns about the epidemic, with the May contract closing lower. 0.83 cents or 1.27%, and the settlement price was 65.47 cents per pound, hitting a low since early December 2019. In the past three trading days this week, the US Dow Jones Index has dropped a total of 1,975 points, and ICE cotton futures have dropped a total of 3.53 cents this week.
Foreign news reports that in addition to the further spread of the new coronavirus in South Korea and Italy, many countries including Greece, Georgia and Brazil have confirmed cases of the new coronavirus for the first time. Meanwhile, authorities are imposing more travel restrictions and quarantine measures on multiple continents, the full extent of which is still unknown. At the same time, China’s economic activity has been largely disrupted, weakening China’s expectations for importing agricultural products from the United States.
Traders believe that cotton demand is quite good at these low prices, but are not sure whether China will immediately enter the market. On Thursday, the U.S. Department of Agriculture will release its weekly report on U.S. cotton exports. Considering the impact of the COVID-19 epidemic on market psychology, U.S. cotton export signings and shipments must perform well to curb the decline in cotton prices. Whether U.S. cotton exports to Asian countries can maintain strong growth momentum is worthy of attention. </p
