After enduring two days of pounding, the cotton market was able to fractionally recover. The trigger for the latest market decline of nearly two cents was attributable to President Trump’s “London comments” that a trade deal may not necessarily happen till after the 2020 election. Still, there is a glimmer of hope for a trade deal before the end of this month according to some trade insiders.
However, complicating the path to a trade was when the U.S. House passed a bill on Tuesday to punish Chinese officials for human rights violation to a portion of their Muslim population.
Thursday, USDA issues its weekly supply-demand data, which of late has been quite strong. Then on Friday, spot December cotton expires. To date some 810 notices, representing 81,500 bales, have been delivered. However, all tenders have been stopped by what is known in the industry as “strong hands,” meaning a well-positioned commercial.
Lastly, come next Tuesday, USDA will report on the supply/demand situation for the U.S. and the world. Last month, the government substantially cut the top three foreign producers of Pakistan, India and China. That act lowered global carryout over three million bales.
Wednesday spot December ended at 63.17 cents up 0.07 cent, March settled at 64.70 cents, up 0.65 cent and December 2020 closed at 67.06 cents, up 0.10 cent. Estimated volume was 26,279 contracts.