Out Of Control Epidemic Situation In Europe And The United States

 

Several international cotton merchants and large-scale import enterprises said that the driving forces for the continuous rebound of ice and foreign cotton spot mainly include the following points:

 

First, the US $900 billion fiscal stimulus plan was approved by both parties at the last minute. On October 20, the U.S. Congress finally reached an agreement on a $900 billion stimulus plan, aimed at boosting the U.S. health care system and stimulating the economy in trouble under the weight of the new epidemic. The U.S. stock market and commodity futures rose;

 

Second, global agricultural products are in a big cycle of rising prices. The impact of the epidemic has brought about the expectation of food shortage and price rise, which reflects that the commodity market will stimulate the rise of grain futures prices and add corresponding speculation and speculation to further drive the instability and fluctuation of grain prices. Oil and oil crops and corn have the largest increase in the international agricultural products, and corn and soybean in the domestic market are the most eye-catching, which also set a record high;

 

Third, the "huge amount" of new money will be put into operation in 2020, which will inevitably lead to big inflation. According to the latest data released, the world's eight major economies will add 14 trillion US dollars of currency in 2020, which is an unprecedented shocking data. It has never happened in human history. The price of these currencies will rise sharply in any field where these currencies flow. Therefore, this is the root cause of super inflation and high asset price bubble. In 2020, the world's 12 largest economies will have a huge increase The total amount of monetary input reached 95 trillion US dollars;

 

Fourth, the global cotton supply fundamentals "scratch the surface". It is mainly reflected in the overestimation of US cotton output in 2020 / 21, the continued large number of Chinese buyers signing contracts to import American cotton, the indirect "assistance" of Pakistan's production and marketing and India's CCI acquisition, and the large decline of Brazil's new cotton planting area, etc., which provide a "pedal" for funds and speculators to speculate.

 

However, judging that both sides of the long and short sides will have a stalemate and a fierce battle at 80 cents / pound. It is not easy for ice to open and stabilize for the fund, and it will not be achieved overnight. The main reasons are as follows:

 

      First of all, the real risk of the world is still the new epidemic situation which is coming back again. European countries fall again, the United States is out of control, the epidemic situation in Japan, South Korea and other countries is on the rise again, and the global situation of prevention and control is not optimistic. Secondly, the risk of global political conflict is on the rise, and the situation in the Middle East is becoming increasingly tense. However, whether the OPEC + composed of the organization of Petroleum Exporting Countries (OPEC) and its allies will raise the issue in February On the issue of Plateau oil production, Saudi Arabia opposes increasing production, while Russia takes the lead in calling for an increase in production on the ground of demand recovery, leading to an abrupt end to the rise in crude oil futures and black commodities.