According to some international cotton traders and exporters of cotton, the price of grain crops such as wheat, corn and soybeans has suck up sharply in recent years. The trend of ICE cotton futures is deviating from the trend of crude oil and other commodities. The main producing areas such as the US and India have not been affected by the weather since February. The growth of cotton growing area in the northern hemisphere in 2022 is lower than that of the previous institutions. Expectations of cotton related enterprises.
A foreign businessman said that since March, the upside down range between ice’s far monthly disk price and recent monthly disk price has gradually narrowed, and the oscillation of inquiry and contract signing of American cotton cargo in 2022 / 23 has rebounded (the main buyers are Pakistan, Vietnam, Bangladesh and Indonesia, and there are few contracts signed by Chinese enterprises), indicating that institutions and speculators have a significant increase in global cotton planting area and output in 2022, The expectation that supply is higher than consumption has weakened significantly, and the basis of ice contracts has been reasonably adjusted.
Statistically speaking, Chicago soft red winter wheat futures (SRW) delivered in May jumped 7% to $12.94 per bushel on Monday (wheat futures rose more than 40% last week, the largest weekly increase on record); Corn futures rose 3 cents to US $7.5725 per bushel, or 0.4% (9.6% in March and 27.6% so far in 2022); Rice, soybeans, peanuts and other agricultural products are also rising. Therefore, not only the proportion of farmers’ intention to “change cotton to grain” in the United States, India, Central Asia and West Africa has increased rapidly compared with January / February, but also the enthusiasm of some basic farmers and cooperatives in Xinjiang to expand grain planting area in 2022 is also gradually rising.
In addition, due to the low temperature in most of the United States up to now, the continuous drought, less precipitation and poor soil moisture in the cotton areas in the West and southwest of the United States, and the large-scale precipitation in the cotton areas in the south central and Southeast forms waterlogging, it has a great impact on the spring sowing of cotton, and the abandonment rate may be higher than that in previous years. According to the judgment of some foreign investors and institutions, the year-on-year increase of American cotton planting area this year may be significantly lower than the 13% predicted by USDA; In the northern Indian state of Punjab, Haryana and other insect disasters are rampant, and farmers are deeply troubled. They are hesitant to maintain or expand the cotton planting area in 2022. However, with the sharp rise in the prices of grain and other crops, the enthusiasm of “abandoning cotton to grow grain” has obviously recovered.
Source: China Cotton network
Post time: Mar-14-2022