In August 9th, ICE futures fell slightly. In addition to the shelving of Sino US trade negotiations, several weeks of violent clashes and unrest began to spread to financial markets in Hongkong, China. The market is not clear when the problem will be solved. In addition, China's PPI fell 0.3% in July compared with the same period last year, but CPI rose by 2.8%, which was unfavourable to consumption and production.
Beginning in 2019/20, the US cotton export contract volume reached 7 million 460 thousand packs, the highest in 25 years. It has completed 47.3% of the USDA forecast, and the mean value in the past five years is 39.7%. Next Monday (August 13th), the US Department of agriculture will issue a forecast of supply and demand. Traders expect us cotton exports to be cut by 500 thousand packages, because China's future import demand is uncertain. Although China has signed a total of 1 million 800 thousand packs of cotton and cotton in the new year, which is basically the same as that of the same period last year, the market believes that the contract is difficult to execute or cancel.
In addition, the output of US cotton is likely to increase again. The US cotton growth has been good after the last forecast of 22 million packages. However, the weather in the United States has once again attracted attention. The temperature in the next 6-10 days is high and rainfall is relatively low. The proportion of good seedlings has dropped by 13% in the recent week. The weather problem may have an impact on the output, and it will be good for the price.
In August 9th, ICE futures closed down slightly, fundamentals and technology remained extremely empty. Even if the market was oversold next week, cotton prices would hardly return to above 60 cents. This week, ICE futures contracted 0.52 cents in December. In August 9th, Trump hinted that the planned Sino US trade negotiations in September might not happen, and he himself was not eager to solve the Sino US trade issue, which is undoubtedly another pressure on the market.