National Day Cotton Market at a Glance: A New Low in ICE Cotton Exports

ICE cotton future -- during the national day, ICE cotton future continued to follow the fluctuation of the external market. The main force's contract in December temporarily rose to 90 cents and then continued to look down. It set a new low of 81.55 cents in the current round, falling to the previous low of 82.54 cents in July. As of October 7th, the main force's contract for December closed at 84.23 dollars, which was 1.11 dollars lower than September 30th, or 1.3%. At present, the overall situation of the market continued to dominate the trend, and new cotton was about to be listed in a concentrated manner. It was difficult to support a big rebound of the cotton price from the basic point of view, and the market would continue to be under pressure in the short term.

According to the global supply and demand forecast for October released by the ICAC international cotton Consulting Committee (ICAC), the cotton market in 2022/23 would face three major threats: yield decline, consumption decline and market turmoil. ICAC estimated that in 2022/23, the global cotton stock at the beginning of the semester was 20 million 373 thousand tons, and the output was 24 million 985 thousand tons. The total supply was 45 million 357 thousand tons, the consumption was 25 million 299 thousand tons, the export was 9 million 546 thousand tons, and the stock at the end of the semester was 20 million 58 thousand tons. In the test of 2022/23, the index of the group A was 99-150 dollars per kilo, and the middle price was 121 dollars per kilo.

Cotton production in the United States -- the American cotton production report released by the American Department of agriculture on October 3rd showed that as of October 2, 2022, the rate of cotton growth in the United States was 77%, 10 percentage points higher than the previous week, 8 percentage points higher than the same period of last year, and 4 percentage points higher than the average in the past five years. The progress of American cotton harvest was 22%, 7 percentage points higher than the previous week, 9 percentage points higher than the same time last year, and 5 percentage points higher than the average in the past five years. 31% of American cotton had a good growth condition, which was on par with the previous week. It was 31 percentage points lower than that of last year. The ratio of the poor seedling in the neighboring cities was 69%, which was 8 percentage points higher than that in the previous week.

Cotton export from the United States - the report of the American Department of agriculture showed that on 23-29 September 2022, the total amount of American land cotton signing in 2022/23 was 27 thousand and 500 tons, which was significantly increased from the previous week's 6849 tons. The total amount of cotton signing in this year and next year was 38 thousand and 500 tons, and the total amount of cotton signing in the previous week was 16 thousand and 600 tons. The American cotton load was 48 thousand and 200 tons, higher than the previous week's 42 thousand and 800 tons. There was a rumor in the market that the American cotton contract was cancelled a lot, but the actual cancelled quantity last week was only 5 thousand and 300 tons, which was almost the same as the previous week.

India——during the national day, the price of India's cotton gauze export plummeted, mainly affected by the plummet domestic cotton price and the weak overseas demand. With the coming of the Lantern Festival, the domestic demand for cotton in India did not rebound, which caused the price of domestic cotton to fall again. Most of the varieties fell 20-35 per kilo, or 4-10%.

On the weekend of national day, the spot price of S-6 in India continued to drop 4500 / Claude, 6.1%. As the number of new cotton on the market steadily increased, the domestic cotton price in India at the end of September fell 20-24% from the beginning of September. According to the external report, the cotton yield in India in 2022/23 was expected to increase by 15%, because the planting area had increased by 8%, the weather and growing environment were good, and the recent rainfall was gradually restrained, so the cotton yield was expected to increase.

Pakistan -- during the national day, the price of cotton in Pakistan fell, partly because the current cotton price at home and abroad was lower. In the next week, the price of cotton in Pakistan continued to decline along with the ICE future. The Karachi spot price index fell 2000 per cent, or 9.52%. At present, the quantity of new cotton on the market in s city was still very small. The flood caused most of the cotton fields to be damaged, and business activities were far from returning to normal.

Due to the flood, the cotton yield was greatly reduced, and the small and medium-sized spinning factory in Pakistan was closed. The stock of the large companies that were responsible for the supply of Nike, Adidas, Puma and Taghit group was sufficient, so the impact was small. Although the large company was less affected by the lack of stock, the small factory that sold sheets and towels to the United States and Europe had begun to close. According to the association of Pakistan's export department, the shortage of high-quality cotton, the high cost of fuel and the insufficient payment and recovery of the buyer were the reasons for the closing of the small spinning factory.