Cotton Ends Slightly Down, Awaits Sally’s Wrath
December cotton closed slightly higher Wednesday as traders take a wait and see stance to what subsequent crop damage will occur from Hurricane Sally. It has pummeled the Gulf Coast with heavy rains and driving winds, resulting in 500,000 residents losing power. As Sally moves inland, it will begin to lose some of its punch, nonetheless, there is havoc yet to wreak.
The Federal Reserve concluded its two-day policy meeting, leaving interest rates unchanged. According to the post-announcement statement from Fed Chairman Powell, domestic interest rates will remain virtually zero into 2023. On that news, the Dow popped higher, while the dollar slipped lower.
Thursday, USDA will report its weekly sales and exports data. Last week saw sales of 126,700 bales and shipments were 230,500 bales. China was the dominant participant in that business. There is a running feud building between China and the U.S. over human rights violations. To that end, the U.S. is still considering seizing all cotton imports from China’s Xinjiang Province. According to U.S. Homeland Security, some 85% of China’s at-risk imports can be traced back to that Province.
For Wednesday, December Cotton closed at 66.37 cents, down 0.07 cent, March closed at 67.18 cents, down 0.06 cent and December 2021 finished at 66.30 cents, up 0.04 cent. Estimated volume was 16,896 contracts.