Overnight, the cotton market is recovering slightly after extreme losses Tuesday. The decline was the result of several negative news stories, among which was one on China’s poor economic showing for 2018. After plunging into triple-digit losses, so far this morning the cotton market is trading a tad higher.
Of course, not helping cotton’s situation is the fact the U.S. government’s shutdown is entering its 33rd day. This partial closure is really taking a toll on current and future marketing decisions of producers. This will be the fifth week in a row sales and exports data will not be available.
That absence begs the question, even though the data is not being publicly published, is it still being gathered, and by whom? Another problem for producers is 2019 acres. To that end, with a lack of marketing data how will producers know how many acres to plant?
Reports from the annual World Economic Forum in Davos, Switzerland are painting a gloomy economic picture for the world. The U.S.-China trade war, the Brexit failure, the rise of Russia in the Middle East, and rising interest rates are causing high anxiety among the world’s elite investors. The United States, Great Britain and China are not in attendance this year.
For today support for March cotton is 72.90 cents and 72.25 cents, with resistance at 73.60 cents and 74.70 cents. Overnight volume is estimated at 2,605 contracts.