Factors Such As The Change Of US President Increase The Uncertainty Of Cotton Market

Last week, domestic cotton prices rose, while international cotton prices fell; The price of domestic cotton yarn turned down from stable, while the price of external yarn continued to decline. Recently, a series of economic data released in China has boosted market confidence and hedged some downward pressure on consumption. The re inflation trend in the United States has depressed the market, and the strong export data of American cotton has failed to prevent the decline of foreign cotton prices. Next week, emotional game will still be the main feature. The new President of the United States will take office, and the Chinese New Year is approaching. The market is still dominated by risk aversion. Part of the capital is expected to withdraw from the market, and the momentum of trading may weaken, and the probability of cotton price volatility will increase.

　 Last week's price review

Last week, data from the National Bureau of Statistics showed that the domestic economic growth rate in 2024 had reached the target of 5% at the beginning of the year. The national work conferences held by relevant departments deployed key tasks in 2025, stabilized market expectations, boosted market confidence, and domestic cotton prices rose. The latest series of economic data released by the United States showed strong performance, further reducing the expectation of the Federal Reserve to cut interest rates, and the international cotton price consolidated and fell. The average settlement price of the main contract of Zheng Mian Futures was 13562 yuan/ton, up 126 yuan/ton from the previous week, or 0.9%; The national cotton price B index, which represents the market price of standard lint in the mainland, averaged 14636 yuan/ton, up 47 yuan/ton or 0.3% from the previous week. The average settlement price of the main contract of cotton futures in New York was 67.45 cents/pound, down 0.74 cents/pound from the previous week, or 1.1%; The international cotton index (M) representing the average landed price of imported cotton at China's main port is 76.92 cents/pound, which is converted into RMB 13419 yuan/ton of import cost (calculated by 1% tariff, excluding port miscellaneous and freight), down 173 yuan/ton or 1.3% from the previous week. The domestic cotton price is 1217 yuan/ton higher than the international cotton price, and the difference between domestic and foreign cotton prices is 222 yuan/ton larger than last week.

The price of domestic cotton yarn turned down from stable, while the price of external yarn continued to decline. This week, the average price of domestic C32S combed pure cotton yarn was 21095 yuan/ton, down 40 yuan/ton or 0.2% from the previous week. The average price of conventional outer yarn is 22023 yuan/ton, down 100 yuan/ton from the previous week, or 0.5%. The average price of conventional outer yarn is 928 yuan/ton higher than that of domestic yarn, 60 yuan/ton narrower than that of the previous week. The price of polyester staple fiber was 7088 yuan/ton, up 140 yuan/ton or 2.0% from the previous week.

　 Recent market situation outlook

（1） International market

The new US president will take office, and the international cotton price is expected to consolidate. The market's concern about the imposition of import tariffs by the United States, coupled with the recent surge in crude oil and natural gas prices, has led to increased inflationary pressure in the United States. The latest data shows that in December, the US CPI increased by 2.9% year on year and 0.4% month on month, rebounding to the level in July 2024. The next meeting of the Federal Open Market Committee will be held from January 28 to 29. The market expects that the possibility of the Federal Reserve cutting interest rates is almost zero. At the same time, economic data reflect that the recovery of the US economy is relatively strong.

In December, the index of new orders in the US manufacturing industry rose to 52.5, the highest level since January 2024; US retail sales increased by 3.8% year on year and 0.4% month on month. In the cotton market, the export volume of American cotton increased, but failed to support the ICE cotton price. According to the data of the US Department of Agriculture, as of January 9, 2025, the net contracted volume of US cotton was 72400 tons, an increase of 122% over the previous week and 69.9% over the average of the previous four weeks; The shipment volume was 52900 tons, up 16.6% from the previous week and 51.2% from the average of the previous four weeks. In the short term, it is expected that the international cotton price will remain weak and consolidate, and it is necessary to focus on the trend of the tariff policy of the new US government and whether the recovery momentum of US cotton exports can be sustained.

　 （2） Domestic market

Enterprises are mainly risk averse before the festival, and the domestic cotton price may be under pressure of callback. According to the data of the National Bureau of Statistics, the added value of industries above designated size increased by 6.2% year-on-year in December, 0.8 percentage points higher than that in November; Retail sales increased by 3.7% year on year, 0.7 percentage points higher than that of last month. The above economic data boosted market confidence to some extent. In terms of cotton market, the replenishment of cotton enterprises has entered the final stage, and the logistics companies will also be closed for holidays in succession.

According to the data of the national cotton market monitoring system, as of January 16, the sales progress of Xinjiang cotton was 34.0%, up 5.8% year on year, 1.1 percentage points lower than that of last week. The overall atmosphere of the textile market has not improved, and the orders of enterprises before the festival have been basically completed, focusing on the digestion of inventory. Considering that the domestic cotton price has responded to the positive macro news this week. With the approaching of the Spring Festival, the change of the US president and other factors increasing market uncertainty, market participants in the near future are mainly risk prevention and control, and some capital may be withdrawn from the market. The momentum of trade will be weakened, and the domestic cotton price is expected to be weak with a high probability of shock.