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DTN Cotton Open: Slips on Export Sales Slump

Ernst Undesser
By Duane Howell DTN Cotton Correspondent September 14, 2017

DTN Cotton Open: Slips on Export Sales Slump

©Debra L Ferguson Stock Images

U.S. weekly upland export sales fell to 65,200 RB for this season and shipments declined to 108,500 RB. Cash online sales resumed on a turnover of 418 bales on The Seam.

Cotton futures ticked on modest losses early Thursday after data showed slower U.S. weekly export sales and shipments.

December hovered off 26 cents at 68.83 cents, near the low of its 70-point range from 69.45 to 68.75 cents on a contract volume of 3,628 lots. It posted the session low on the heels of the export sales report. March ticked down 23 points to 68.37 cents, trading within a 57-point span from 68.86 to 68.29 cents on a turnover of 632 lots.

Net U.S. upland export sales for shipment this season declined to 65,200 running bales during the week ended last Thursday from 116,100 RB the previous week, USDA reported.

Sales went to 13 countries, led by Vietnam, South Korea, Mexico, Turkey, Bangladesh and the Philippines. Gross sales were 67,900 RB and cancellations were 2,600 RB. Sales for next season fell to 26,400 RB, all for Pakistan, from 43,100 RB.

Upland shipments of 108,500 RB, down from 164,300 RB, went to 17 countries, headed Vietnam, China, India and Pakistan.

Net Pima sales for this season edged up to 3,800 RB from 3,000 RB, while shipments of the extra-long-staple cotton of 3,700 RB were up from 3,500 RB.

In outside markets, U.S. dollar index futures traded down 0.245 to 92.265, while Dow Jones futures ticked down 34 points and DS&P futures 6.75 points. Crude oil gained 53 cents to $49.83, Brent crude added 37 cents to $55.53 and December gold rose by $1.70 to $1,329.70. December corn and November soybeans were up 0.57%, December Chicago wheat up 1.02% and December Kansas City wheat up 0.68%.

Overseas stocks were mostly lower after data showed retail sales and industrial output growth slowed in China. Asian stocks closed down 0.29% in Japan’s Nikkei 225, down 0.42% in Hong Kong’s Hang Seng, up 0.74% in South Korea’s Kospi and down 0.8% in China’s Shanghai Composite Index. European shares traded down 0.7% in Britain’s FTSE 100, down 0.26% in Germany’s DAX and up 0.06% in France’s CAC 40.

China’s Zhengzhou cotton futures closed with mostly losses and so did prices on the China National Cotton Exchange. India’s MCX cotton futures rallied.

In ICE cotton futures Wednesday, December rallied to close little changed after falling to an intraday low 9.8% below Friday’s contract high.

The inverted December-March spread traded between 33 and 60 points and narrowed 15 points to settle at a 49-point December premium on a volume of 6,273 lots. March-May traded between 65 and 60 points carry and widened two points to close at a 61-point May premium on 1,483 lots. May-July widened a point to close at a 43-point July premium on 643 lots.

In cash online trading, sales resumed following an inactive session as 483 bales changed hands on prices averaging 62.80 cents, reflecting premiums of 14.36 cents over loan values of 48.44 cents. Offerings were 7,704 bales.

Grower-to-business sales totaled 418 bales on average prices of 61.80 cents per pound and business-to-business sales were 65 bales on an average price of 69.25 cents. The G2B sales included 276 bales of staples 34 or less and 142 bales of staples 35 or more. All the B2B sales stapled 35 or more.

The Cotlook A Index of world values dropped 300 points to 79.10 cents, leaving the premium over the prior-day December futures settlement unchanged at 9.99 cents.

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Ernst Undesser
By Duane Howell DTN Cotton Correspondent September 14, 2017