For the third consecutive day, December cotton futures closed higher, rising by 1.17 cents to a closing value of 89.86 cents. March 2022 futures closed up 1.03 cents at 89.41 cents. The cotton bullish trend that began from the low set in late March is alive and well.
Helping cotton futures was a jump in sales for 2020-21 last week of 40,000 round bales — up 16% from the previous week. That number was still down 22% from the four-week average. Leading buyers were Turkey, China and Pakistan. For 2021-22 sales were 251,900 RB. For the 2020-21 crop year, there remains an outstanding balance of 5,700 RB, with the lion’s share of that to China.
West Texas is expected to get a few showers with less than a half an inch with just 25% coverage, while the Delta will receive rains of 1/2 to 2 inches. There is some concern over the forecast for above-normal temperatures and below-normal precipitation in some cotton growing areas, including Texas.
The rising equities markets, along with rising prices in both India and China have bolstered the cotton market of late. Strong demand for Indian cash cotton is also providing a bullish tailwind.
December cotton futures, on volume of 19,101 contracts, exceeded 90 cents for the first time — rising to the highest level since February of 2021, after testing the 90-cent level for four straight days before exceeding that benchmark.