The market finished sharply lower Friday despite improved sales and export data. There was a small cancellation done by China, but total sales this week were greater than those of last week. Nonetheless, the grand trend of the market remains starkly bearish, causing speculators to swell to a record net-short position.
Next week, the market will see fresh supply-demand data from USDA. The current consensus from industry analysts is calling for a reduction of the 2019 crop. Last month, saw the crop swell to 14.50 million bales, a 14-year high in production.
Of course, the burning issue for the market is the U.S.-China trade war. For the longest time, it appeared the talks were sidelined until next year, but just this week China called (yes, they did) to request the talks resume in October. Our understanding is the Chinese are coming to Washington.
USDA’s market reporting will return on their normal days, with crop condition (soon-to-be crop harvest) on Monday, and weekly sales and exports next Thursday. For the week, December Cotton is down 0.25 cent and has been trading under sixty-cents for at least five weeks.
Friday, December cotton closed at 58.58 cents, down 0.54 cent, March was at 59.31 cents, off 0.51 cent, December 2020 ended at 61.83 cents, down 0.17 cent. Friday’s estimated volume was 25,711 contracts.
- Keith Brown can be reached at firstname.lastname@example.org or by calling (229) 890-7780.