Agfax Buzz:
    May 3, 2012
    400pxcotton_bolls_mature_040928_077

    Doane Cotton Close: Rumors of Chinese Buying Lifted New Crop Futures

    AgFax.Com - Your Online Ag News Source

    The Doane Cotton Commentary - Leading in Agricultural Analysis Over 70 Years - Copyright

    The cotton market finished lower on Thursday. Futures spent the majority of the session lower, but a midday rally in the December almost turned prices back positive. July settled 30 points lower at 89.21 cents and December was down 6 points at 86.52 cents.Talk of Chinese buying picking back up helped lift new-crop futures late in the session. The trade seems to feel that U.S. prices are cheap enough to attract buying, as China will prefer to source from the U.S. at these levels. Thursday’s export report was mixed for cotton. Upland sales were negative 25,226 running bales due to cancellations from China and Indonesia. Pima sales were positive, however, at 11,032 running bales.

    Total shipments were a strong 336,373 running bales. Total shipments so far are 8.43 million bales, compared to USDA’s estimate of 11.4 million. Combined with outstanding sales of 3.65 million bales this puts the total at 12.08 million bales. There are typically some bales carried over at the end of the marketing year, but there is still some cushion right now where the cancellations are not a threat to reducing the export estimate. Adding to the bearishness are increasing rain forecasts for west Texas. Texas has been under drought conditions for well over a year, which led to record abandonment and low yields in 2011. South and central Texas has gotten good rains the past month, but west Texas and the panhandle are still under severe to extreme drought.

    Midday forecasts today greatly increased the amount of rain expected for Texas next week, calling for 2.0 to 3.0 inches in west Texas and as much as 4.0 inches in concentrated areas. Hot temperatures have mitigated the relief of recent rains, as evaporation rates are high, but this heavy of a rain should help improve soil moisture considerably, especially if it comes at a slow rate.News on Monday that India would reopen its export market sent old crop prices sharply lower. July fell to a 2-week low on Monday before losses were trimmed, while December fell to a 4-month low. Today July bounced up a little more as most likely viewed the sell-off as overdone given India’s unpredictability. December was kept in check by the good rains that have been helping replenish very depleted soil moisture levels in Texas. Adding to new-crop pressure was Monday’s good Crop Progress report.

    On Monday India announced that they were lifting their ban on cotton exports. India initiated the ban unexpectedly in early March, sending prices up the limit. Since then there have been a number of adjustments made that have kept the market guessing, but have also seemed to compromise India’s reliability in the eyes of those in the cotton market. At one point it sounded as if India will be allowing a set number of exports, with 1.5 million to 2.0 million bales mentioned, while others indicate the lift on the ban is indefinite. Additional cotton available for export is bearish for the U.S. as a competitor, but India’s loss of stature as a reliable exporter will be in the back of buyers’ minds and will likely limit the impact of the ban being lifted.

    Monday’s Crop Progress report showed cotton planting still well ahead of normal, with 26% planted versus last year’s 16% and the 5-year average of 19%. Texas was slowed down a little by rains last week, though no one would begin to complain about rain in Texas at this point! Texas is 25% planted, up just 2% from the previous week. Georgia, the next biggest production state, is 23% planted versus the 5-year average of 9%.

     

    Copyright , Doane Advisory Services

    >

    Agfax Cotton News

    Farmland Partners Buys 15,000 Row Crop Acres In Carolinas, Virginia3-27

    Rose on Cotton: Don’t Miss an Opportunity. Get Short Terms in Place.3-27

    Cleveland On Cotton: “December has 70-cents-plus written all over it.”3-27

    Weekly Cotton Market Review – USDA3-27

    DTN Cotton Close: Light Volume with Outside Support3-27

    Video: 13 Best Practices to Manage Tarnished Plant Bugs3-27

    Mississippi: Fertilizer Costs – Everything Old Is New Again3-27

    Texas: Hale and Swisher Crops Conference, Plainview, April 143-27

    Arkansas: Falling Cotton Prices Make Peanuts Tempting Alternative3-27

    Corn Maybe Has More Bullish Potential Than Beans Ahead Of USDA Projections3-27

    DTN Cotton Open: Little Change on Thin Volume3-27

    Making Money With Manure, Advantages of Composting and Additives – DTN3-26

    South Texas: Wet Weather, Farming Problems to Persist, Says Expert3-26

    ELS Cotton Competitive Payment Rate Is Zero3-26

    DTN Cotton Close: U.S. Premium Widens3-26

    Video: Summary of U.S. Drought Monitor in One Minute3-26

    Drought Monitor: Warm, Dry Weather Further Depletes Snowpacks3-26

    Oklahoma: Ag Pesticide Disposal, Purcell, April 223-26

    Residential Propane, Heating Oil: Prices Decrease3-26

    Diesel: Prices Decrease3-26

    Gasoline: Prices Up Slightly3-26

    DTN Cotton Open: Cash Grower Sales Slumped3-26

    U.S. Energy: Gasoline Specifications Change and So Does the Price3-26

    DTN Cotton Close: Choppy Trade Day3-25

    Oklahoma: Payne County Designated Natural Disaster Area3-25

    Marketing: Are You Really Getting the Best Price for Your Crop? – farmdoc3-25

    Irrigation – Moisture Sensors Pay Dividends, Says This Consultant (Podcast)3-25

    DTN Cotton Open: Cash Grower Sales Slowed3-25

    AFB Cotton Close: Dec. Holds Above 643-24

    DTN Cotton Close: Ginnings Show Larger ’14 Crop3-24

    Texas: More Rain, More Planting Delays3-24

    Farm Bill: USDA Seeks to Limit Payments to Non-Farmers3-24

    Non-Family Farm Managers: Proof Required for Program Payments, 2016 – DTN3-24

    DTN Fertilizer Trends: Price Stability Could Be an Illusion3-24

    DTN Cotton Open: Chinese Manufacturing Slows Down3-24

    Cotton: Aerial Imaging Pinpoints Root Rot, Could Help Save Money3-24

    Farmers Anticipate Hard Times; Weather, Water Issues in the West – Keith Good3-24