Understand The Trading Rules Of NYBOT And The Factors Affecting Global Prices

American cotton, namely American cotton, is one of the most important varieties in the global cotton market. American cotton futures refer to the cotton futures listed on the New York Mercantile Exchange (NYBOT). This contract is based on American cotton, and each contract represents 50000 pounds of cotton net weight.

American cotton, namely American cotton, is one of the largest and most active cotton futures markets in the world. American cotton futures refer to the cotton futures varieties listed on the New York Futures Exchange (NYBOT). This contract is based on American cotton, and each contract represents 50000 pounds of cotton net weight. These contracts allow investors and producers to hedge price risks, and also provide trading opportunities for speculators. Traders can hedge the risk of cotton price fluctuations or conduct speculative transactions through this contract.

Trading time and rules of American cotton futures:

1. The trading time of American cotton futures is from 21:00 to 20:59 from Monday to Friday, and the daily trading time is 23 hours.

2. The trading rules of American cotton futures are similar to those of other futures markets. Long or short transactions can be carried out. Investors can invest or hedge cotton through futures contracts.

It is understood that the United States is currently the second largest cotton producing country in the world. The four main cotton growing areas of the United States are: the southeast, central and southern regions, southwest and western regions.

1. Western cotton region

This region is the production base of high-grade cotton in the United States. This area is divided into two categories, one is the famous SI in the United States Acala cotton, which is the best quality cotton in the United States. The other type is C/A cotton, which is produced in California/Arizona and has a higher grade, but slightly lower than SJV cotton. The harvest period is from the end of September to the beginning of December.

2. Central and southern regions

The cotton output in this region accounts for about 32% of the total output of the United States, which is mainly used for domestic consumption, and the export volume is very small. The growth cycle lasts from the middle of April to the beginning of September, and the harvest period is from the end of September to the beginning of December.

3. Southeast region

The cotton planted in this region accounts for about 24% of the total cotton in the United States, mainly low-grade cotton. It is also the most developed area in the textile industry in the United States. The growth cycle of cotton is from the beginning of April to the beginning of September, and the harvest period is from the end of September to the beginning of December.

4. Southwest cotton region

The output of cotton planted in this region accounts for about 24% of the total output. It is also the main export place of American cotton. More than half of the cotton is used for export. The cotton called M/O/T in the international market is the cotton in this region.

Influencing factors of American cotton futures

The price fluctuation of American cotton futures is affected by supply and demand, international cotton inventory, seasonal factors, climate factors, production and application of substitutes, exchange rate changes, political factors and other factors.

1. Supply and demand

This is the key factor affecting the futures price of American cotton. In terms of demand, changes in demand in the textile industry directly affect cotton prices; In terms of supply, US cotton output and export volume are important indicators.

2. International cotton inventory

Inventory consumption ratio is the preferred indicator to evaluate the cotton supply and demand situation. It is the ratio of ending inventory to consumption in the current year, which has a very consistent inverse relationship with cotton prices. Generally speaking, the higher the inventory consumption ratio, the lower the cotton price

3. Seasonal factors

Cotton has a long growth cycle, which is greatly affected by seasonal factors. For example, the sowing season, growing season and harvesting season all have an impact on cotton prices.

4. Climatic factors

It takes 7-8 months from planting to harvesting. Due to the long growth cycle, cotton is greatly affected by natural factors. In addition, cotton growth is very sensitive to weather conditions. Extreme weather events such as drought and flood may lead to a decline in output, thus pushing up cotton prices.

5. Production and application of substitutes

Cotton and chemical fiber products can replace each other in the textile industry, and their market positions are complementary. Therefore, when the supply of cotton is tight or the price is rising, the consumption of synthetic fiber will rise, and vice versa.

6. Exchange rate change factors

In recent years, due to the instability of the global economy, the exchange rate changes frequently, which has a certain impact on the international cotton price, especially the import and export business. According to data, through correlation analysis, there is a certain correlation between the US dollar exchange rate and the US cotton export price.

7. Political factors

Changes in the policies and political situation of major producers and importers will have an impact on cotton prices.