The cotton market is lower Tuesday with overnight comments from President Trump suggesting the possibility of a long-term delay with a China deal bringing out the bears. March cotton has already taken out its low of last week, and is threatening to break established trend-line support. Adding to cotton’s negative tone Tuesday is a retreating Dow Jones.
USDA reported the 2019 crop is 83% harvested. That number is above last year’s same time pace of 74%, and exceeds its five-year average of 81% gathered. Reports we gather indicate the nation’s gins are running at a fevered pace as many producers want to jettison their production fearing even lower prices.
The comments from President Trump are casting a tone of doubt over the market making this week’s sales and exports data all the more important. If the market can see strong sales, essentially minus China, it would then have reason enough to at least stabilize. Still, a new round of U.S. tariffs are due to be implemented on December 15, so sentiment may worsen all the more.
For Tuesday, support for March cotton is 64.30 cents and 63.70 cents, with resistance at 65.60 cents and 66.20 cents. Overnight, volume is 7,680 contracts.