Can Cotton Prices Recover From The Start Of Demand?

In March 11th, although the US stock market continued to plummet, ICE futures rose in early trading. Last week, the signing and shipment of US cotton reached an annual high level, and China's purchases were quite active. The market expects that the US cotton export weekly report this Thursday will be a shining figure.

The next important event is the USDA cotton planting forecast report of March 30th. So far, all unofficial surveys show that the US intends to reduce cotton planting area in 2020. Not long ago, the US Agricultural Outlook Forum also estimated that the US cotton planting area will be 12 million 500 thousand acres this year, and the recent fall in the new flower contract may lead to a further decrease in the intention area.

In March 11th, ICE futures closed slightly higher, and textile mills bought support after the fall in cotton prices. The market await the weekly export sales report released on Thursday by the US Department of agriculture (USDA). Fu Stone Company said that at this price we saw many cotton mill operations. Chicago's Price Futures Group says cotton prices are too cheap, and there is expected to be strong demand in the market.

The World Health Organization says the new crown pneumonia epidemic has a pandemic feature. The US stimulus package to reduce the impact of the new crown disease may include tax cuts, but lacks specific details. Analysts say that because the new crown pneumonia has a pandemic feature, grain and cotton prices may be stuck in the region unless substantial breakthroughs are made in the US stock market.