DTN Cotton Close: Tumbles to New Low in Dec.

U.S. export commitments reached nearly 105% of the USDA estimate for 2016-17 and already 30% of the 2017-18 projection. Rain prospects promising for Texas Plains, but previous disappointments noted.

Cotton futures tumbled to triple-digit closing losses in most contracts beyond soon-to-mature July Thursday, with December falling to its lowest finish since Aug. 31, despite robust U.S. weekly export sales.

December lost 143 points to settle at 66.74 cents, just off the low of its 145-point range from unchanged at the session high on the opening overnight down to 68.17 cents, its lowest intraday price since Sept. 1. This was its 10th lower close in a row.

With only one trading session now left before first notice day, July snapped settled up 25 points to 71.14 cents. It traded within a 71-point span, from a new low for the move at 70.68 cents up to 71.39 cents. October closed down 24 points to 68.03 cents, trading within a 193-point range between 66.34 and 68.27 cents.

Volume increased to an estimated 42,546 lots from 28,094 lots the prior session when spreads accounted for 11,827 lots or 42%, EFP 134 lots and EFS 82 lots. Options volume rose to 17,870 lots (5,362 calls and 12,508 puts) from 7,695 lots (6,560 calls and 1,135 puts).

Net U.S. all-cotton export sales for shipment this season and next surged to a whopping 652,300 running bales during the week ended June 15, up from 270,300 RB the previous week.

Sales for this season hit a nine-week high of 177,000 RB, boosting 2016-17 commitments to 14.73 million RB, up 5.593 million RB or 61% from a year ago. Commitments were nearly 105% of the USDA export forecast, compared with 103% of final 2015-16 shipments at the corresponding point last season.

New-crop sales at a seasonal high of 475,300 RB, up from 197,600 the prior week, brought 2017-18 commitments to 3.947 million RB, already 30% of the USDA projection for the marketing year beginning Aug. 1. Forward sales a year ago were 1.713 million RB, 12% of the current 2016-17 export estimate.

All-cotton shipments quickened to 266,300 RB from 245,800 RB the week before, raising the season’s total to 12.638 million RB. Weekly shipments now need to average roughly 237,800 RB a week over the six weeks left in the crop year to meet the forecast.

Shipments of 12.638 million for the season were up 5.131 million RB or 68% from year-ago exports and were 90% of the USDA estimate. A year ago, shipments were 82% of final exports.

On the weather scene, isolated showers and thunderstorms are forecast for the Lubbock area Thursday night, mainly in the northern counties, rising to a 30% chance Friday and 50% Saturday. Chances are expected to linger into early next week.

Some thunderstorms from Friday night through Monday will have the potential to produce concentrated areas of heavy rainfall, forecasts indicated. However, some promising earlier forecasts have proved disappointing.

Meanwhile, heavy rains had fallen in some cotton areas of the Delta and Southeast and more was on the way from Tropical Storm Cindy.

Futures open interest declined 1,808 lots to 204,966 on Wednesday, with July’s down 2,142 lots to 7,453, December’s down 331 lots to 160,135 and March’s up 199 lots to 25,270.

Certified stocks grew 4,682 bales to 487,788. There were 4,783 newly certified bales and 101 bales decertified. Awaiting review were 3,742 bales, all at Memphis.




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