DTN Cotton Open: Ticks Little Changed

December set session low on opening overnight. U.S. consumer prices rose slightly in July. Cash business sales declined to 801 bales on The Seam.

Cotton futures ticked around little changed early Friday, with December having set the session low on the overnight opening.

December hovered off three ticks at 68.08 cents, near the low of its 41-point range from 68.02 to 68.43 cents. It was positioned to wipe out gains of the last three weeks. March eased down a point to 67.82 cents, trading within a 40-point range between 67.76 cents and 68.16 cents.

In the news, U.S inflation remained subdued in July, extending a slowdown this year, Dow Jones Newswires reported.

The consumer-price index, which measures what Americans pay for everything from ice cream to doctor visits, increased 0.1% in July from the prior month, the Labor Department said. Excluding the often volatile categories of food and energy, so-called core prices also rose 0.1%.

Economists surveyed by The Wall Street Journal had expected overall and core prices to both advance 0.2% on the month. From a year earlier, overall consumer prices climbed 1.7%, as did core prices.

In outside markets, U.S. dollar index futures traded down 0.274 to 93.030, while Dow Jones futures edged up 11 points and S&P futures up 2.75 points. Crude oil dipped 13 cents to $48.46, Brent crude dropped 11 cents to $51.79 and spot gold gained 0.06% to $1,287.33. December corn was up 0.11%, November soybeans up 0.66%, September Chicago wheat down 0.23% and September Kansas City wheat down 0.4%.

Earlier, escalating tensions between North Korea and the United States weighed on stock markets abroad. Asian markets closed lower, down 2.04% in Hong Kong’s Hang Seng, 1.69% in South Korea’s Kospi and 1.59% in China’s Shanghai Composite Index. Japan was closed for a holiday. European shares fell, down 1.16% in Britain’s FTSE 100, 0.2% in Germany’s DAX and 1.1% in France’s CAC 40.

China’s Zhengzhou cotton futures settled lower, as did prices on the China National Cotton Exchange. India’s MCX exports traded lower.

In ICE cotton futures Thursday, December closed down the 300-point daily limit but didn’t lock limit down. It finished below lows of the previous nine sessions.

The December-March spread traded between 21 and 40 points and narrowed seven points to settle at a 28-point December premium on a volume of 6,197 lots. March-May traded between 46 and 24 points carry and widened 17 points to close at a 44-point May premium on 929 lots.

In cash online trading, business-to-business sales slowed to 801 bales from 1,610 bales on The Seam. Prices slipped to an average of 64.98 cents per pound from 66.08 cents, reflecting a drop to 15.67 cents from 22.03 cents in premiums over loan repayment rates. The cotton included 764 bales of staples 34 or less and 37 bales of staples 35 or more. No grower-to-business sales were reported.

The Cotlook A Index of world values was unchanged at 81.35 cents, narrowing the premium over the prior-day December futures settlement two points to 10.24 cents.

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