Global destocking process accelerated, cotton prices can remain strong?The following time, we follow xiaobian together to see a look at the details of the information.
Cotton prices in China and India have soared in the past month, from 87 cents to 93 cents in China and from 73 cents to 83 cents in India for the s-6.Pakistani cotton prices rose from 65 cents to 68 cents
The U.S. department of agriculture forecast in July reduced global cotton production for this year and next and increased global cotton consumption for this year and next, resulting in lower global ending stocks for this year and next.Although 81.8 per cent of inventory consumption is still double the historical average, the reduction of global inventory shows that the process of global cotton destocking has been significantly accelerated.
Recent increases in cotton prices have been supported by short-term shortages, particularly in India, where prices have risen as much as 15 cents a month.
The main problem for China now is that although cotton reserves continue to be pumped out in large quantities, the market is still short of supply.Since may, almost all of the cotton reserves have been sold. However, the quality of some of the cotton reserves was not up to standard, which led to a decrease in the number of listings in June. Traders were waiting to sell the cotton at a high price after they sold it.
If China continues to be independent of international markets, excess inventory in other countries will be difficult to absorb at a time of sluggish global consumption growth.