DTN Cotton Close: Craters on Outside Markets

©Debra L Ferguson Stock Images

The cotton market was sharply lower Thursday amid heavy and panicky speculative selling. Traders tore into markets across the trading spectrum as fears of higher interest rates from the Federal Reserve and price clampdowns ordered by China sent many markets spinning to their limit-down levels.

To that end, December cotton violated its big limit-down Monday low, despite the fact USDA reported great expert sales business Thursday morning. At the close, more than a few traders and analysts were left slack jawed.

Weather-wise, all eyes are fixated on the tropic depression, which is scheduled to be in the central Gulf of Mexico by Friday. As it stands, the Delta and Southeast may see heavy downpours this weekend. Otherwise, the six- to 10- and eight- to 14-day forecasts call for below-normal temps and above-normal precipitations for the Delta and Southeast. For West Texas, the outlook indicates above normal temps and below normal precipitation.

Friday, the CFTC will issue its weekly Commitment of Traders report. Via the last report, managed-money funds had just increased their net long position, but after Wednesday, who knows?

As the market enters its Friday session, December Cotton is down 3.86 cents for the week, up 0.74 cent for the month and is 10.36 cents higher on the year.

For Friday, July closed at 84.17 cents, down 1.16 cents, December settled at 84.06 cents, down 1.89 cents and March 2022 ended at 83.94 cents, down 1.92 cents; estimated volume was 35,686 contracts.

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