Home / Knowledge / News / Textiles / 2006/07 fundamental analysis summary

2006/07 fundamental analysis summary

20
Feb '07
The old crop U.S. and world cotton supply/demand outlook remains framed by the January 12 USDA World Agricultural Supply/Demand Estimates (WASDE) report which forecasted U.S. average yield and production of, respectively, 819 lbs/acre and 21.72 million bales.

While the supply side of the picture is now more or less settled, U.S. exports is the main variable determining old crop futures prices (i.e., the Mar07, May07, and Jul07 contracts).

The January WASDE report lowered expected U.S. exports again, down to 15.7 million statistical bales, which is the cumulative annual amount expected to be shipped by July 31, 2007. The bottom line suggests a small increase in 2006/07 U.S. stocks-to-use relative to the previous marketing year. The change in U.S. stocks-to-use from year to year generally moves in the opposite direction of U.S. prices.

This implies a supply/demand rationale for '07 old crop futures contracts to trade in a similar to slightly lower trading range to their 2006 counterparts. However, these price depressing fundamentals could be supported by strength in Dec07 futures. Also, old crop futures could still rise (and fall) based on purely technical factors, as has been the case over the last two months.

The USDA numbers for the foreign and world situation project a decrease in 2006/07 world stocks-to-use by less than 4% down to 43.1%. Historically, such a move implies only mild support for the A-index of world prices. This suggestsa small chance of seeing the A-index reach the 66-67 cent level where the value of the LDP erodes away.

Texas A&M University, USA


Must ReadView All

Pic: Shutterstock

Textiles | On 23rd Sep 2021

Global economic recovery continues but remains uneven: OECD

The global economy is growing far more strongly than anticipated a...

Pic: Shutterstock

Textiles | On 23rd Sep 2021

ADB revises down Cambodia’s growth forecast, sees rebound in 2022

Cambodia’s economy is projected to grow by 1.9 per cent this year...

Pic: Shutterstock

Retail | On 23rd Sep 2021

Prompt action needed to reduce business rates burden on UK retail: BRC

The British Retail Consortium has urged the government to take prompt ...

Interviews View All

Textile Industry, Head honchos

Textile Industry
Head honchos

Marry with brand ethos

Textile Industry, Head honchos

Textile Industry
Head honchos

Strongly believe in 'people first' policy.

Textile Industry, Head honchos

Textile Industry
Head honchos

Great step towards realising end goal of 'AtmaNirbhar Bharat'

Susan Bhaktul,

Susan Bhaktul

Established in 2000 as a liaison with the Government of India, Industree...

Ujjval Saraf,

Ujjval Saraf

Founded by Jimmy Lai, Giordano International Ltd, a Hong Kong based...

Klaus Bergmann,

Klaus Bergmann

German company Erbatech GmbH develops, designs and manufactures high end...

Michael Jaenecke, Messe Frankfurt

Michael Jaenecke
Messe Frankfurt

From May 14 to 17, international exhibitors will present the entire...

Daniel Kaye, RocketLife

Daniel Kaye
RocketLife

<div>RocketLife, an award-winning developer of breakthrough visual...

Shlomzion Chen, Seevix

Shlomzion Chen
Seevix

Seevix Material Sciences Ltd, which develops and manufactures synthetic...

Raghavendra Rathore, Label Raghavendra Rathore Jodhpur

Raghavendra Rathore
Label Raghavendra Rathore Jodhpur

Being one of the first designers to use the "Brand India" positioning for...

Sweta Agarwal, A Humming Way

Sweta Agarwal
A Humming Way

A Humming Way (AHW) is inspired by the old-world regalia of Rajasthan...

Niti Singhal, Twee In One

Niti Singhal
Twee In One

Best known for convertible clothing, Indian brand Twee In One by designer...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


September 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search