The cotton market suffered triple-digit losses Monday as COVID-19 fears rode roughshod over the financial and commodities markets. The Dow Jones precipitously fell almost a 1000 points Monday, and that does not include its 300-point spill last Friday.
In addition, Sunday afternoon OPEC announced its members had come to terms on reducing crude oil output. Thus Monday was something of a perfect storm against market bulls. The connotation for cotton is a COVID-19 slowdown in Asia might result in a slowdown in fiber demand.
Monday afternoon, USDA will issue its weekly crop condition data. Last week the tabulators had pegged the crop at 56% good to excellent, an unusually high number.
Traders are also anxious to see Thursday’s export sales. With the current crop year set to expire in two weeks, it will be interesting to see how much old-crop business will be rolled into the new crop season.
The six- to 10-day forecast calls for normal to below-normal temperatures in West Texas. The 8- to 14-day outlook shows a similar pattern, while the Delta and Southeast will see greater potential for heavier rains.
Monday, December settled at 86.71 cents, down 3.22 cents, March ended at 86.35 cents, down 2.95 cents and December 2022 ended at 79.13 cents, down 0.81 cents; estimated volume was 42,541 contracts.