Cotton Higher on Weather Concerns
A weekend freeze and predicted hurricane landfall later this week are weighing on the cotton market.
The cotton market was materially higher Monday as concerns over Tropical Storm Zeta and the West Texas weekend freeze have inspired the market to trade higher. Zeta is expected to achieve hurricane status this week and promptly hit the U.S. Gulf Coast as a hurricane this Thursday/Friday. The Delta crop has already been banged on by other storms on several prior occasions.
West Texas is being hit with a winter storm which brought in freezing rain. Based on its current intensity there will be, no doubt, further yield loss to the Texas crop. USDA will issue its latest crop condition/ harvest update at 3 p.m. CDT Monday. Last week the 2020 crop was 34% gathered.
The Dow Jones and related markets were sharply lower Monday based on increasing COVID-19 infections and a lack of new stimulus funding. That small panic did rally the U.S. dollar and was slightly friendly to gold. Apparently, if it weren’t for the current adverse weather events harming cotton, we would think such negativity in the financial markets would have weighed on the cotton market.
For Monday, December Cotton closed at 72.11 cents, plus .82, March settled at 72.72 cents up .85. and December 2021 cotton finished at 70.76 cents, .57 higher. Monday’s estimated volume was 31,453 contracts.