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DTN Cotton Open: Hits New Current-Crop Contract Highs

Ernst Undesser
By Duane Howell DTN Cotton Correspondent December 15, 2017

DTN Cotton Open: Hits New Current-Crop Contract Highs

©Debra L Ferguson Stock Images

March positioned for eighth consecutive weekly gain. Cash online sales increased to a crop year high of 32,373 bales on The Seam, including 24,587 bales of grower sales on The Seam.

Cotton futures hit new contract highs in 2017-18 marketing year contracts and traded on solid gains in early dealings Friday.

March hovered up 83 points at 76.16 cents, trading within a 126-point range from 75.04 to 76.30 cents on a contract volume of 7,143 lots. It was positioned for its eighth consecutive weekly gain, having closed last Friday at 73.72 cents.

May ticked up 75 points to 76.38 cents, trading within a 105-point range from 75.38 to 76.43 cents on a turnover of 2,074 lots, and July gained 69 points to 76.66 cents.

In outside markets, U.S. dollar index futures ticked up 0.145 to 93.625, while Dow Jones Industrial Average futures traded up 88 points and S&P futures up 8 points. U.S. stocks recovered from a bout of uncertainty surrounding passage of the much-awaited tax overhaul bill.

West Texas Intermediate crude oil gained 25 cents to $57.29 and Brent crude added 11 cents in a volatile week of price swings. February gold gained $6.10 to $1,263.20. March corn was up 0.22%, January soybeans up 0.34% and March Chicago wheat and March Kansas City wheat up 0.24%.

Asian stocks closed mostly lower, down 0.62% in Japan’s Nikkei 225, down 1.09% in Hong Kong’s Hang Seng, up 0.51% in South Korea’s Kospi and down 0.8% in China’s Shanghai Composite Index. European stocks were trading mostly higher, up 0.19% in Britain’s FTSE 100, up 0.12% in Germany’s DAX and down 0.12% in France’s CAC 40.

China’s Zhengzhou cotton futures were stable and prices settled mostly with gains on the China National Cotton Exchange. India’s MCX cotton futures continued to rise and crop prices were firm as seed cotton arrivals declined amid a one-day ginners strike.

In ICE cotton futures Thursday, March settled on its second straight triple-digit gain and hit its highest price since last March, a single point from its contract high.

The March-May spread traded between 43 and 25 points carry and narrowed 12 points to close at a 30-point May premium on a volume of 4,650 lots. May-July traded between 38 and 28 points carry and widened two points to settle at a 34-point July premium on 2,137 lots.

Cash online sales increased to a crop year high of 32,373 bales from 19,351 bales on The Seam. Prices rose to an average of 70.24 cents from 68.94 cents. Premiums over loan rates climbed to an average of 19.03 cents from 18.39 cents. Loan values averaged 51.22 cents, up from 50.55 cents. Offerings were 104,503 bales.

Grower-to-business sales of 24,587 bales brought an average price of 69.50 cents per pound, with 299 bales from the Southeast going for 76.50 cents and 24,288 bales from the Southwest for 69.42 cents. Business-to-business sales of 7,786 bales, all from the Southwest, brought prices averaging 72.58 cents.

The Cotlook A Index of world values gained 125 points to 84.70 cents, widening the premium over the prior-day March futures settlement three points to 10.57 cents.

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Ernst Undesser
By Duane Howell DTN Cotton Correspondent December 15, 2017