The cotton market has fleeting moments of bullishness, quickly followed by bouts of bearish nauseousness. To that end, March cotton has fallen over 10% in value as the market is dealing with a big harvest, a strong U.S. dollar, and the Omicron situation.
USDA reported much improved sales Thursday, but poorer shipments. The data from the government website is as follows: Weekly sales of 374,900 RB for 2021/2022 were up 90 percent from the previous week and up noticeably from the prior 4-week average.
Increases primarily for Vietnam (147,100 RB, including 1,600 RB switched from China, 200 RB switched from Japan, and decreases of 200 RB), China (123,600 RB), Turkey (55,000 RB), Pakistan (36,600 RB), and South Korea (2,300 RB, including 1,800 RB switched from Vietnam), were offset by reductions for Malaysia (200 RB).
Exports of 71,400 RB were down 27 percent from the previous week and 29 percent from the prior 4-week average. The destinations were primarily to China (23,700 RB), Mexico (14,800 RB), Vietnam (9,000 RB), Turkey (6,000 RB), and Pakistan (5,800 RB). Net sales of Pima totaling 6,400 RB–a marketing-year low–were down 65 percent from the previous week and 67 percent from the prior 4-week average.
Increases primarily for China (2,600 RB), Thailand (1,300 RB), India (1,000 RB), Vietnam (900 RB), and Egypt (400 RB), were offset by reductions for Bangladesh (900 RB). Exports of 2,300 RB were down 63 percent from the previous week and 69 percent from the prior 4-week average. The destinations were to India (1,000 RB), Turkey (400 RB), Pakistan (400 RB), Thailand (400 RB), and Peru (100 RB).
Thursday, OPEC meets to discuss what if any reaction it will take against certain western nations for tapping into their oil reserves. There has been talk of maintaining current production rates, as well as reducing oil drilling as well.
Friday at 8:30 a.m. EST, the Labor Department will issue its monthly jobs report. Expectations call for 550,000 non-farm jobs to have been created in November. Last report revealed 531,000 jobs were developed for October.
For Thursday, close-in support for March cotton is 103.30 cents and 101.30 cents, while resistance stands at 108.40 cents and 110.10 cents. The estimated morning volume is 8,450 contracts.