After a decidedly up-on-Monday event in which the market was dialing in some damage from the remnants of Hurricane Barry, Turnaround Tuesday is showing up today, and prices are lower.
Monday, USDA published its latest condition numbers that underscore a huge domestic crop in the making. Overall, the nation’s cotton crop is rated 56% good/ excellent, two points higher than last week, and 15 points up on last year’s 41% good/excellent for this time of year. Texas and Georgia are rated 52% and 59% good/excellent in their respective ratings.
Tuesday the Federal Reserve will meet to discuss interest rate policy, and will announced any changes Wednesday at 2 p.m. CDT. The Fed is expected to lower interest rates one-quarter point, yet it is equally believed such a cut is already dialed in by the financial markets.
Traders continue to monitor weather events in India. Initially, they planted some ten percent less cotton as farmers went to other crops, but of late all of India has been suffering from delayed and infrequent monsoons. Additionally, China is reportedly fighting an infestation of Fall Army Worms, while Pakistan is battling desert locusts similar to an Old Testament plague.
For today, support for December cotton is Friday’s low of 62.60 cents, with resistance at 64.20 cents and 64.70 cents. Overnight estimated volume stands at 3,039 contracts.