DTN Cotton Close: Market Ends Mixed

Image from Texas AgriLife Extension

July cotton closed up 1.22 cents Friday while the December contract was down 0.19, a mixed finish that saw both contracts achieve modest gains for the week.

July cotton finished up 1.22 cents Friday at 94.94, just shy of its contract high as prices recovered from a lower start earlier in the week. December cotton prices closed down 0.19 cent Friday, but still posted a 0.24 cent gain for the week, supported by Thursday’s report of a new marketing year high in U.S. cotton exports while West Texas remains stressed by drought and hot temperatures.

The latest seven-day forecast continues to expect moderate to locally heavy rain amounts in the southeastern U.S., possibly reaching near the Mississippi Delta. West Texas and the southwestern Plains remain dry however, explaining why USDA said 22% of cotton crops in Texas are rated poor and 1% is rated very poor. Around the globe, West Texas remains the lone serious production problem so far as other cotton regions are doing well overall.

Technically, the uptrend in cotton prices remains active in spite of a heavy load of 120,456 contracts of net longs, held by noncommercials, representing 90% of their positions. Bullish inverses in futures spreads also indicate a bullish outlook among commercials, willing to pay up for nearby contracts.

In cash online trading, The Seam showed 3,956 bales sold Thursday at an average price of 69.37 cents. Average loan value was 43.52 cents and 28,239 bales were offered.

The ICE daily stocks report showed certified stocks down 289 on Thursday at 78,377.

The Cotlook A Index of world values for June 7 was up 1.50 cents at 99.00 cents, putting the premium over the July futures settlement at 5.28 cents.

In outside markets, the June U.S. dollar index is up 0.16 at 93.54, while Dow Jones Industrial Average futures are up 52 points at 25,293. July crude oil is down 29 cents and August gold is unchanged at $1,302.90. July corn was up 1 1/2 cents, July soybeans were down a nickel and July Kansas City wheat was down 6 1/4 cents.

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