Cotton Ends Higher on Sales
The cotton market finished Thursday’s session higher, reflecting this morning’s stout sales and decent shipments data. The sales number was 220,000 bales, compared to last week’s 98,000 bales sold. The up move gave December cotton its highest close since Jan. 22. To that end, since its April low, the market has risen some 40% and now stands less than 1.25 cents from posting new annual highs.
On Monday, USDA will update its crop harvest and condition data. At last count, the 2020 crop was 34% gathered. Thus, by next week, the gathering efforts will be nearly 50% complete. The weather outlook does call for above average rainfall for the six- to 10-day forecast. Such weather is apt to do more harm to cotton grades than cotton yields.
An interesting report emerged on Thursday from a major U.S. investment bank suggesting a “commodities boon” is in the works. It bases its optimistic forecast on the trillions of stimulus dollars now in the world, as well as new demand growth as global economies recover from COVID-19. A weaker dollar could certainly enhance such a move.
As December cotton enters its Friday trade, it currently stands 2.02 cents up on the week, 6.15 cents on the month and, most amazingly, up 1.58 cents on the year. Subscribers will remember at its worst moment this year, April 2, the new crop cotton was down 23.00 cents.
For Thursday, December cotton closed at 71.94 cents, up 0.90 cent, March settled at 72.51 cents, up 0.78 cent and December 2021 finished at 71.07 cents, up 0.56 cent. Estimated volume was 27,945 contracts.