On the first trading day after the National Day holiday, all Zheng cotton contracts closed at the daily limit after the opening, and then hit a new high in the evening session. The highest price of the main CF2201 contract reached 22,200 yuan/ton, reaching a high of nearly ten years. Many industry insiders said that it hit the daily limit at the opening, and it is rare to hit such a high price in real terms. While some bullish funds are cheering for joy, many market participants say that the turning point may have arrived.
During the National Day holiday, ICE U.S. cotton futures soared, reaching a ten-year high, stimulating Xinjiang’s seed cotton harvest to become more enthusiastic. Some cotton companies’ aggressive mentality increased, resulting in machine-picked seed cotton prices after the holiday. It once exceeded 11 yuan/kg, and hand-picked seed cotton also exceeded 12 yuan/kg. According to rough estimates by some ginning companies, the price of seed cotton has risen, and the cost of spot lint has exceeded 25,000 yuan/ton and 26,000 yuan/ton, approaching the 30,000/ton mark.
Relevant departments have taken measures in this regard. In order to promote the smooth operation of the cotton market and meet the cotton demand of cotton spinning enterprises, on October 8, China Cotton Reserve Management Co., Ltd. planned to list 15,000 tons of reserve cotton for out-of-warehouse sales, and the actual transaction volume was 15,000 tons, with a transaction rate of 100%. In addition, China Cotton and China Textile also put a certain amount of imported cotton on the market. A large number of cotton ginning companies have suspended acquisitions in Xinjiang. As of October 9, there are still many companies in northern Xinjiang that have stopped harvesting, and some purchasing companies have lowered the purchase price of machine-picked seed cotton to 10.5-10.6 yuan/kg.
Some cotton ginning companies in Wusu, Kuitun and other places said that due to the increased risk aversion of companies, the atmosphere of rushing to harvest has declined. In addition, relevant departments have released cotton to increase supply. In order to prevent prices, some cotton farmers As prices continue to fall, sales opportunities are missed, and there is a significant increase in vehicles going to companies for sale. There are also some cotton farmers who still hold a bullish attitude and adopt a wait-and-see attitude. According to some professionals, the current market price is at a high level and may fall quickly. However, overcapacity in ginning is still a prominent problem. The possibility of rising again cannot be ruled out. At least some companies have begun to cut prices, which will inhibit the bullish mentality. </p
