Sino US Successful Meeting, Zheng Cotton Market Rebounded Highly Or Limited

In June 29th, the news of the successful meeting between Chinese and American leaders in Osaka, Japan, was brushed around the circle of friends, and the United States promised not to impose tariffs on the remaining $about 300000000000 of Chinese exports. The continued deterioration of trade between the two countries is temporarily suspended and a step towards cooperation. It is not clear whether the two sides will be able to talk about the future well, but the market needs this strong agent, especially for the cotton market.

This round of rebound, what level can Zheng cotton reach, there are still differences between the outside world, but the view of the rise is almost the same. According to Futures Company professionals, with the release of good news from China and the United States, the rebound height of Zheng cotton should be 14500-15000 yuan / ton, which is the price before negotiation. As part of the tariff of $200 billion has not yet been abolished, the levy rate has not been lowered, so it can not be returned to 15000-16000 yuan / ton for the time being.

As early as May this year, an analysis report of Changjiang futures believed that the global planting area increased gradually over the past three years, and the output went up to a higher level. The global production and marketing gap gradually narrowed down, and the supply of cotton in the 2018/19 year was ample. With the influence of Sino us negotiations, macroeconomic and weather factors, cotton prices in 2019 were liable to rise and fall, and the price fluctuation interval was 14000-16500 yuan / ton.

Cotton Corp analysis of spot trading shows that the restart of Sino US trade negotiations should have certain support for exports, but the height of the rebound should be limited, and the rebound height will not exceed 15000 yuan / ton. Because this is back to the fundamentals of reality. At present, even if the export is resumed, a process is needed. It is difficult to digest the stock of cotton resources in the short term in the short term. Once the price rebounded to the expected price range of traders, there will be a hedging sale and a long set of dissolving sets. Judging from the overall situation, Sino US relations are by no means a simple trade dispute, so there is still greater uncertainty in the latter part of the negotiations.

Of course, the market is also gradually maturing. Many professionals realize that the increased tariffs have not been cancelled. We should not be blindly optimistic on this point. The Sino US trade relations are full of long-term, complexity and uncertainty. We should make psychological preparations and risk prevention for possible changes. The "five fifth" barrier is an important point widely recognized by the market. Whether or not it can be touched or breakthroughs remains to be seen. After all, the road ahead is still full of uncertainties, and the market is likely to change at any time.