The cotton market is beginning to bend lower amid marketing-year-low sales for the current season.
A summary of USDA’s report follows: Net sales reductions of 5,200 RB for 2019/2020–a marketing-year low–were down noticeably from the previous week and from the prior 4-week average.
Increases for Bangladesh (90,800 RB, including decreases of 11,700 RB), Vietnam (38,100 RB, including 4,500 RB switched from Indonesia, 3,800 RB switched from South Korea, 400 RB switched from Taiwan, and decreases of 7,200 RB), Turkey (7,700 RB, including decreases of 100 RB), Taiwan (3,500 RB, including 900 RB switched from Vietnam), and Ethiopia (800 RB), were more than offset by reductions primarily for China (101,000 RB), Indonesia (19,400 RB), Pakistan (11,300 RB), South Korea (7,400 RB), and Thailand (3,800 RB).
For 2020/2021, net sales of 107,400 RB were primarily for Indonesia (23,100 RB), China (21,100 RB), Turkey (17,200 RB), El Salvador (14,900 RB), and Bangladesh (11,600 RB).
Exports of 486,600 RB–a marketing-year high–were up 21 percent from the previous week and 23 percent from the prior 4-week average. Exports were primarily to Vietnam (116,000 RB), Turkey (88,400 RB), Pakistan (72,700 RB), China (64,600 RB), and Indonesia (52,400 RB).
Net sales of Pima totaling 1,800 RB were up noticeably from the previous week, but down 87 percent from the prior 4-week average. Increases for China (2,800 RB, including 2,600 RB switched from Hong Kong) and Turkey (1,700 RB), were offset by reductions primarily for Hong Kong (2,600 RB).
Exports of 33,400 RB–a marketing-year high–were up 40 percent from the previous week and 86 percent from the prior 4-week average. The primary destinations were primarily to China (13,900 RB), India (7,300 RB), Vietnam (3,000 RB), Pakistan (2,900 RB), and Bangladesh (2,000 RB).
Also this morning, the Labor Department reported another massive unemployment claims number of six million. That brings the three-week total to 15.0 million people filing for unemployment funds.
At noon CDT Thursday, USDA will present its monthly supply-demand report for April. Expectations call for lower U.S. production, but lower domestic exports as well. In addition, world carryout is expected to rise as evidenced already by Thursday morning’s poor showing in weekly sales.
For today, support for May cotton is 52.90 cents and 52.10 cents, with resistance at 54.87 cents and 55.25 cents. Overnight estimated volume is 9,519 contracts.