Cotton Turning Around for Red Tuesday
Front month cotton futures are backing off by 60 point with early Tuesday trading. The 40 to 56 point gains in Monday’s cotton market came after the March contract saw a 111 point range. March closed at 82 cents flat, for a 56 point carry to May. The US dollar index futures were higher on Monday, but a cautiously higher crude oil market supported synthetic fiber prices, or at least expectations for same.
USDA’s monthly Crop Production on Friday cut cotton yield by 18 lbs/acre to 765 – now the weakest since 2003, though similar to 2015. That reduced supply by 310k bales to 12.78 million. USDA cut domestic use by 150k, and lowered the unaccounted line, for a net 100k bale tighter carryout of 3.1 million bales.
The Cotlook A index was 275 points higher on 12/8 to 92.70 cents/lb. The Seam confirmed 4,039 bales were sold online on 12/08 for an average gross price of 75.86 cents. The AWP for the week was lowered by 55 points to 63.63 cents/lb.
Mar 24 Cotton closed at 82, up 56 points, currently down 62 points
May 24 Cotton closed at 82.56, up 52 points, currently down 60 points
Jul 24 Cotton closed at 82.87, up 42 points, currently down 61 points
On the date of publication, Alan Brugler did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
