Chapter 370 Stop it!
That night, Guo Yang noticed an important reason for the rapid spread of the fire: drought.

This factor, which has been overlooked for a long time, may be the biggest obstacle to energy forests this spring.

The next morning, Guo Yang found Ning Xiaojing and asked, "How long has it been since it rained in the north?"

"I'll check right away."

"Well, we need to check both the Xanthoceras sorbifolia and Leprosy areas, and notify the bases below."

Ning Xiaojing was obviously not prepared. She nodded and turned around to make arrangements.

In the financial market this morning, CF903 was still active, with prices jumping up and down. Guo Yang did not pay much attention to it. He thought that if he loosened some liquidity this week, he would counterattack next week.

From the perspective of the bears, the main bulls are somewhat powerless, perhaps due to the impact of the fire last night?
In short, the bears are eager to try.

Nearing 11 o'clock, Ning Xiaojing also brought the latest weather data.

"At present, there has been no rainfall in Wuwei, eastern Longzhong and eastern Longdong for two months, and there is a certain degree of drought."

"There is a slight drought in Yunnan Province, but not in Guangxi Province for now. The overall situation in the project area is still relatively good."

"But some wheat areas in North China, Inner Mongolia and Shanxi Province were severely affected. The State Flood Control and Drought Relief Headquarters launched a Level I drought emergency response six days ago, which was also the first time that my country launched a Level I drought emergency response."

"In addition to wheat, the forest areas in the north are also severely affected by the drought, but it has not yet spread to the northwest."

Guo Yang tapped his fingers on the table habitually, "Let each department and base come up with a charter for dealing with the drought."

"If the tree planting progress is delayed due to water shortage this spring, or if there is a large-scale death of trees, the person in charge will submit his resignation report himself!"

Some droughts can be avoided with effective measures, so Guo Yang's words are quite serious.

"Especially in the dry and hot river valleys in the southwest, there is a river as big as the Jinsha River right next to it, so there must be a solution. The same is true for Guangxi Province."

After Ning Xiaojing left, Guo Yang suddenly thought of the eucalyptus trees in Guangxi Province again.

He has learned about the fast-growing eucalyptus during this period. Currently, there is no statement on the Internet that eucalyptus is a "fruitless tree".

There is not even any claim that large amounts of groundwater are being extracted and the ecological environment is being damaged.

The public lacks understanding of eucalyptus, but in fact, its contribution to economic development cannot be denied.

my country is a country with a shortage of timber resources. Timber has long been in short supply and demand has long been falling short of supply. Every year, a large amount of money has to be spent to import large quantities of timber from abroad.

The fast-growing eucalyptus has alleviated this problem to a certain extent.

However, fast-growing eucalyptus does have many disadvantages. Large-scale eucalyptus planting will lead to the continuous degradation and even extinction of native species. Plant water pumps are not an exaggeration.

However, how did it become a household name in later generations?

Guo Yang thought of the drought.

The climate-induced drought has attracted widespread attention from society, which then drew attention to the existence of the fast-growing eucalyptus.

This is a very reasonable explanation.

It seems that there has indeed been drought in the southwest region in recent years, and it is very likely that the neighboring Guangxi Province has also experienced drought.

"We have to guard against it!"

"Both Yunnan and Guangxi provinces have planted trees on a large scale in mountainous areas, and the construction of water-lifting projects and supporting facilities has been accelerated."

"If the drought doesn't happen this year, it could be next year or the year after next."

Guo Yang made a note in his notebook and planned to bring it up at the next meeting.

February is mainly spent on various preparatory work. On one hand, we are busy preparing for spring plowing, and on the other hand, we are busy preparing for tree planting. There are really a lot of things to do.

Guo Yang inspected seeds, agricultural machinery, pesticides, organic fertilizers, etc. in various places for three consecutive days and made timely adjustments if there were any problems.

On February 2, Luo Potassium's general manager Zhou Weiliang and deputy general manager Li Shoujiang both visited Jiahe.

We signed a deepening strategic cooperation agreement with Denong Agricultural Materials, and also had some exchanges on the second phase of water supply and capacity expansion.

At the end of the exchange, Guo Yang hosted a banquet for Luo Jia and his party in a small square on the Gobi Desert in the evening.

A group of people were chatting around the campfire.

Zhou Weiliang said: "Looking back now, Denong Agricultural Materials was the biggest winner in the potash fertilizer circulation market last year!"

"Some people hoarded food in the first half of the year, which resulted in everyone having nothing to eat in the end."

Due to the snowstorm, Denon used up the potash fertilizer it had stockpiled before the snowstorm early last year, and there was no supply afterwards until the end of the year when Luo Potassium went into production.

Therefore, he was not aware of the changes in the potash fertilizer market in the second half of last year.

Guo Yang smiled and said, "The circulation link is definitely not as profitable as the production link."

"It's hard to describe it in one sentence," Zhou Weiliang said. "Last year's market was like a mid-air dive."

"Without Denong's goods, the price of imported potash fertilizer has risen to 7000 yuan per ton, and the price of domestic potash fertilizer is 4700 yuan per ton."

"Many distribution companies were reluctant to sell and failed to put the goods on the market in a timely manner."

"With the weakening of market demand in the second half of the year, there has been a serious backlog. Currently, domestic potash fertilizer inventories are as high as more than 600 million tons."

"Imported white potash is now 4000 yuan per ton, and domestic potash fertilizer is around 2700 yuan per ton, but there is still no market for it."

Guo Yang looked at Yuan Wenwu who was accompanying him. The latter was still eating barbecue, and suddenly he felt that many eyes were on him.

Yuan Wenwu was a little dumbfounded. He had only taken a few bites of meat, so why were they staring at him?

After racking his brains, Yuan Wenwu said, "De Nong didn't sell much potash fertilizer in the second half of the year. Most of it was organic fertilizer, as well as nitrogen and phosphorus fertilizers. The main reason was that there was no potash fertilizer supply."

Of course, it is also related to the fact that the market has been ruined and Denon is unwilling to purchase in large quantities.

Guo Yang smiled and took over the conversation, "That's good. With the support of Luo Potassium, Denon can move to the next level."

Zhou Weiliang smiled helplessly and said, "In fact, Jiahe's potash development in Laos doesn't need to be so urgent."

"In the next few years, the existing production capacity, plus imports, will definitely exceed demand, and Laos will not have a cost advantage."

Guo Yang also knew the other party's concerns.

"It's still a long way to go before Laos' potash officially goes into production, and the market may not necessarily be in China, so it will definitely not affect our cooperation with Lao Potash."

"I hope so." Zhou Weiliang said leisurely, "In fact, Zhejiang Province Agricultural Materials also contacted Luo Potassium before."

Yuan Wenwu's heart sank, and the barbecue that was about to enter his mouth no longer tasted fragrant.

Guo Yang knew about this. After all, Jiahe was the second largest shareholder of Luo Potassium, and Zhejiang Agricultural Materials had no chance.

But since Zhou Weiliang mentioned it, it means that Luo Potassium cares very much about Jiahe’s investment in Laos.

After thinking for a while, Guo Yang smiled and said, "Mr. Zhou, there will be a huge demand for potash fertilizer in the future. Luo Potassium is a gold mine that makes a fortune every day. Opening a mine in Laos is also a response to the country's call."

"Haha, of course."

Li Shoujiang on the side also said: "Mr. Guo, the greening of Lop Nur Town should also be carried out in Jiahe. Jiahe in the Milan River Basin is preparing to plant trees."

"Boss Li, don't worry, I'll give you a Lop Nur oasis in a few years."

Suddenly, the atmosphere brightened.

At least for a few years, there will be no conflicts between the two sides.

...

The next day, Monday.

Guo Yang asked about Denong’s total fertilizer sales last year, which was more than 220 million tons.

There is still a long way to go to reach the first-tier target of 300 million tons.

"Damn, Yuan Wenwu was eating so much barbecue last night, how can he eat more?"

Thinking about the way Yuan Wenwu ate last night, Guo Yang felt a little angry, and he didn't know to leave the grilled lamb chops for him.

“But the sales of organic fertilizer are still quite good.”

"This year's production target of 20 million tons will definitely meet domestic demand."

After reading some information, Guo Yang turned his attention to CF903.

Last week, Jiahe released water, and CF903 fell from 14105 to 12930, a drop of 1175 points, with the main decline occurring before Wednesday.

On Thursday and Friday, Jiahe made another move to keep the price around 13000.

If you are cautious, you can choose to close your position and stop loss at this time to avoid the subsequent rise.

However, perhaps after a weekend of fermentation, the short sellers raised funds again, resulting in the market's bearish sentiment remaining unabated.

It continued to decline after opening.

However, Guo Yang knew that this situation would not continue.

At around ten o'clock, the trading team composed of Weiguang and Jiahe Grain and Oil began to attack and bought a large number of CF903 contracts.

When Jiahe attacked, the short sellers who were so full of vigor and vitality the previous second seemed to smell blood and rain the next moment.

...

Magic City.

The same diving market after the opening made Liam look confident.

"Look, Rick, we have full control over the market. Jiahe is just a paper tiger. How can they beat us in terms of capital?"

Rick was also in a good mood. The stock price fell by more than 1000 yuan in a week, but there was no decent resistance, which greatly reduced Louis Dreyfus' floating losses.

Rick said: "Jiahe is still very strong and controls the upstream and downstream of the Huaxia soybean industry chain. It may be because of too frequent expansion that it has led to financial constraints."

This week, to be on the safe side, Rick collected a lot of information about Golden Harvest.

The more I learn, the more surprised I am.

Seeds, forage, dairy industry, agricultural machinery, pesticides, fertilizers, grain and oil, feed…

The complete agricultural industry chain is no less than that of any major international grain trader, and is even more complete, because Jiahe is the only grain trader that has agricultural machinery.

The reason why Louis Dreyfus is determined to continue short selling is that Jiahe has made too many overseas investments recently.

At the same time, Jiahe also purchased hundreds of thousands of tons of cotton at high prices on the market, which consumed at least 20 to 30 billion in cash.

Liam said with some disdain, “Then he is just a fat tiger raised in captivity.”

"The rapid expansion and frequent large-scale investments in the past two years have not only drained his funds, but also made him bloated, like a fat sheep waiting to be slaughtered."

Rick smiled, "So we can enjoy this feast."

“That’s natural,” Liam said. “But I’m also curious about how Louis Dreyfus and other grain traders fell into the hands of Golden Harvest.”

"His boss doesn't seem very smart, and some of his investments are hard to understand."

Rick said, "Who knows? I'm only responsible for cotton."

"Deserts, wetlands, rivers, bioenergy." Liam continued sarcastically: "Maybe the international environmental protection organization should give him an award."

"Earth Guardian?"

"Of course, Jiahe paid hundreds of millions of RMB for this, so why not?"

"Hahaha……"

"grass!"

"Boss! Oops, there's something fishy going on!"

Two hurried calls stopped Rick and Liam's laughter, and their eyes quickly returned to the board.

I saw a big positive line in the intraday chart.

In just a few seconds, the number of contracts bought was still rising at an alarming rate.

A huge amount of buy contracts emerged, and the short positions were eliminated immediately. Within a few minutes, CF903 was instantly pulled from a sharp drop to hitting the daily limit.

And they are all large orders of 500 lots!

At the current price, one order is 500*12900=645 million yuan.

And it's not just CF903, other contracts have also seen unusual movements!
Every order was placed with an upper limit of 500 lots, and the posture was like a hungry tiger pouncing on its prey.

"Quick, open a short order!" "Open a short order!"

The two of them issued orders immediately without hesitation. In fact, the traders had already taken action when unusual movements appeared on the market.

But the opponent's method was too fierce!
Even if traders at LDC and Ikam continue to sell into the market, there may even be other shorts selling.

But this time the bulls are coming with great force, no matter how many orders you have, they will all be swallowed in one gulp!

Without even a second's hesitation.

"Continue to open short orders!"

Liam rested his right hand on the desk, his left hand clenched into a fist nervously, and sweat appeared on his palm unconsciously.

He glanced at Rick, who was also staring at the board.

For nearly two hours, the trading volumes of multiple cotton futures contracts of Zhengzhou Commodity Exchange have been rising rapidly.

10 lots!

20 lots!

50 lots!

100 lots!

Even though they were used to seeing big storms, the trader, Rick, Liam and others were all dumbfounded!
The profits of the past week were once again sharply withdrawn in an instant.

"Jiahe has taken action again?"

"Do they have any money?"

"Fuck! How is that possible!"

As of midday, the trading volume reached 120 million lots, with a large amount of more than 903 billion yuan. The closing price rose sharply, and CF was firmly locked at the daily limit.

Medium and long-term contracts such as CF905, CF907, CF909, CF911 and even CF101 could not stand the loneliness and rose sharply one by one.

The battle between bulls and bears in cotton futures is like a dazzling light in this sluggish market, attracting countless people's attention.

Many people were watching this tense situation.

From the current perspective, the bulls are well prepared and have the advantage, but the bears are not without the power to resist.

Some financial media have been paying attention to who the main forces on both the long and short sides are. In China, it is not difficult for these people to find out.

One noon is enough.

The bulls are mainly Jiahe Grain and Oil, while the bears are mainly Louis Dreyfus, Ikam and Zhejiang Merchants.

1 vs 3, and still have the upper hand.

This is certainly good news for cotton farmers who have been watching this battle, and it is also good news for short sellers who believe that domestic cotton prices are being deliberately suppressed.

In the trading room, Liam punched the sofa in frustration, "Damn it!"

"It would be abnormal if Jiahe just closed its positions and stopped losses like this." On the contrary, Rick, who was dragged into the water later, calmed down first.

“Liam, how much capital and room for increasing positions does Ikam have?”

Liam also knew that he had lost his composure, so he took a few deep breaths and said, “At most, we can add another 2 million in margin.”

“It’s a bit too little!”

"I can't help it. I was fighting alone last week." Liam asked as calmly as possible, "It's up to you now, Rick. I know Louis Dreyfus has the support of the bank."

Rick groaned and said, “Louis Dreyfus can add another 12 billion or so.”

"That's enough." Ikam said, "As long as the market sentiment is suppressed, Jiahe will not be able to succeed."

The price fluctuation range of cotton futures in Zhengzhou Commodity Exchange is plus or minus 4%. The initial margin is 5% of the contract value, but the margin is not fixed.

The exchange will adjust the margin ratio based on market price fluctuations, contract term, exchange regulations and other factors.

Sometimes, in order to prevent a short squeeze, the exchange will specifically increase the margin ratio, which will increase the financial pressure on both the long and short sides.

After entering the delivery month, in order to ensure smooth delivery, the margin ratio will be increased to 50%.

Therefore, the closer the delivery date is, the closer the futures and spot prices will be.

Now, with less than ten trading days left until the delivery month, the margin ratio of CF903 has been increased to 20%.

This means that the maximum leverage is only 5 times.

CF905 has also increased to 12%, and only medium and long-term contracts have a lower margin ratio.

The confrontation between the two sides was mainly on contracts 903, 905 and 907.

After analyzing it, Liam said, “So, Jiahe is one-on-many, and the financial advantage is on our side.”

Rick frowned, his reason telling him that he could no longer increase his holdings as the current spot price could no longer hedge the risk.

But at most 15 billion yuan of funds have not been disbursed.

If he just surrenders and leaves with a loss, he will definitely feel unwilling and it will nail him to the pillar of shame.

After hesitating, he nodded.

He also didn't believe how much money Jiahe could come up with.

In the afternoon, cotton futures remained in focus.

Some financial media were already prepared to write articles, and the facts did not disappoint them.

The battle between bulls and bears was still fierce in the afternoon, but bulls still had the upper hand, and CF903 was still closed.
Multiple contracts hit the daily limit, with a record volume of over 250 million contracts traded in one day, exceeding 300 billion yuan in a single day.

The financial media are excited!

How dazzling this is in today's sluggish financial market!
In particular, one of the two opposing parties is one of the four most famous grain traders in the world.

Domestic enterprises are competing against foreign capital, and some financial media have shouted the following slogan.

But the short-selling forces used their mouthpieces to strongly criticize Golden Harvest.

"Louis Dreyfus + Ikam + Zheshang + multiple investment institutions have joined forces. How strong is their financial strength?"

"In the past few years, Louis Dreyfus has long been accustomed to domestic trading habits and has made considerable profits in the past two years."

“It is reported that Louis Dreyfus has foreign banks in the country providing low-interest loans.”

"On the contrary, in the past few years, Golden Harvest has frequently made large investments, but its cash flow is not optimistic and the prospects of the industries it invested in are also unclear."

...

At night, when Guo Yang saw this news, he couldn't help but mourn for the stubborn short sellers.

Jiahe does not need a loan.

The amount of cash in hand alone makes people question their lives.

Guo Yang was not one to fight a battle without confidence, so for this cotton operation, he approved a total quota of 200 billion for Jiahe Grain and Oil and Weiguang.

Half of it was prepared for purchasing cotton, and only a quarter was spent.

The other half of futures, plus leverage, is equivalent to hundreds of billions of funds, and the remaining funds in the spot market can be used for support at any time.

What matters is a horizontal push and a crushing victory!

One characteristic of futures trading is that it can kill your opponents!
The purpose of making profits from futures is to defeat the opponent, so there is no need to talk about short selling when the market is rising wildly.

After the trial on Monday, the two sides continued to fight fiercely in the following week.

But the final outcome is the same every day.

As expected, CF903 continued to hit the daily limit, and the other contracts followed the same script, rising all the way.

The shocking changes caused investors to flee in panic, and many people’s assets were wiped out in an instant.

The bulls are crushing the market again!

Long-suppressed bullish funds followed in and ignited the entire market.

The world has suffered from bears for a long time!
In just one week, cotton market sentiment quickly turned from bearish to bullish.
-
Last week, Zhengzhou Cotton Futures traded 1472 million lots, the highest weekly trading volume in history, and positions increased by 9.8 lots to 69.3 lots, setting a new record. After a round of sharp decline in cotton prices, market funds moved abnormally, indicating a huge difference between the long and short sides in the market.

In just one week, there was blood and gore, and the whole place was devastated. Compared with the footsteps of women with bound feet in the stock market, the futures market was truly a heroic act of massacre and killing.

The above is from Sina Finance report - "Short-term funds bottom-fishing in domestic cotton futures staged a battle between bulls and bears."
-
According to the reporter, the USDA's monthly global cotton supply and demand report on U.S. cotton production has been reduced for four consecutive months. The main reason for the decline in production is the decline in the yield of old U.S. upland cotton, which has also been affected in terms of quality.

At the same time, domestic manufacturers are increasingly buying cotton and are willing to pay high prices to buy it from farmers.
-
Affected by this, domestic and foreign cotton futures prices continued to rise, and cotton farmers were no longer reluctant to sell and were actively preparing for planting.

The above is from financial news reports.

After reading a few pieces of news, Guo Yang felt a little disappointed and prepared to wash up and go to bed.

Suddenly I saw an advertisement on the homepage of Sina - Altai Passion Fishing Competition, who will win the grand prize of tens of millions throughout the year?
Good guy!
Guo Yang was stunned. It was a great achievement for Sina to get the advertisement from Golden Harvest.

Shouldn't this be listed on NetEase and Tencent?

Guo Yang clicked on it and saw at a glance the clear and ethereal photos of Xiangyang Lake, as well as pictures of a rice-sized pike being caught with a lure.

This is followed by a textual introduction that details the entire activity.

The general meaning is that it will last for a whole year, with various large-scale fishing competitions constantly taking place, and experts from home and abroad will be invited.

Mainly based on lure fishing.

The most attractive thing is the prize money of the event, the highest of which is 500 million.

The smallest prize is 50, and it is also the most recent one, for hand-pole ice fishing, on March 3.1st.

"good."

Guo Yang commented, "This is the first competition, and it's ice fishing, so it shouldn't attract too many experts. You can give it a try."

During the weekend, Guo Yang and Luo Xiu drove to the countryside.

While taking a drive and enjoying the scenery of the Qilian Mountains, we also learned about the preparatory work for river management in various places.

And the following week.

The domestic cotton futures market is still active, the bears are making their last struggle, and cotton futures have lost the momentum of last week's surge.

Even as some long speculators closed their positions and took profits, the price quickly fell back to around 15300.

Because next month is the delivery month.

Accounts that are not eligible for delivery will be forced to close their positions!
Bulls are closing their positions with smiles, while bears are closing their positions with tears.

But there are also those who are stubborn and hold on.

Rick and Liam also got into a dispute, and Louis Dreyfus' funds were not fully paid out.

Liam’s eyes were red from staying up late. Staying up late for a long time made him look haggard and his voice was almost hoarse.

"There is still time, why stop trading?"

"Why, Rick!"

Rick is helpless. No matter what choice Louis Dreyfus makes in the current situation, it cannot avoid huge losses.

The previous low point was hit at 10500, and is currently 15300, with the maximum loss per lot being 4800 yuan.

Louis Dreyfus' current position is close to 30 lots, with a loss of at least over one billion.

Even though Louis Dreyfus has 60 tons of cotton in stock and the average purchase price is 2.5 yuan per catty, the floating profit based on the current futures price is about 6 million yuan, but the loss after hedging is nearly 5 million yuan.

Ikam will only be in a worse situation, and so will the short speculators.

One misstep will lead to eternal hatred!
"There's no point in struggling anymore, Liam."

"Look at the market. Obviously, the market sentiment is high, but it can't go up. It has adjusted a little, but it is still hovering on this line."

“I would rather sacrifice more profits than let the price get out of control. I just want to be stable. The opponent’s funds are unfathomable.”

"No chance."

"Stop it, Liam!"

(End of this chapter)