In an attempt to consolidate its recent gains, the cotton market ended Tuesday’s session by closing a little bit up and a little bit down. Spot May was down, while deferred July and December were slightly higher.
The cotton market has been on a small upside tear since last week’s exports-sales data, which showed no heavy cancellations.
With the price of cotton dramatically lower since the first of the year, the industry has been abuzz with talk of foreign mills wanting to renegotiate, or outright cancel previously purchased cotton. Such is why the weekly exports sales reports are taking on extra importance.
On Thursday, USDA will issue another monthly crop report. Early expectations are calling for less production and increases in exports. However, in its “infinite wisdom”, USDA may also anticipate future demand effects from COVID-19 and reduced domestic and foreign usage. Last month China consumption numbers declined one million bales.
May cotton closed at 52.90 cents, down 0.15 cent, July ended at 53.16 cents, up 0.08 cent and December finished at 54.48 cents, up 0.36 cent. Estimated volume was a surprising 58,076 contracts.