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    Weekly Cotton Market Review – USDA

    Photo: Michele Kinder

    Spot quotations were 37 points higher than the previous week, according to the USDA, Agricultural Marketing Service’s Cotton and Tobacco Program. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-36 and 43-49, strength 27.0-28.9, and uniformity 81.0-81.9) in the seven designated markets averaged 104.41 cents per pound for the week ending Thursday, July 28, 2022.

    The weekly average was up from 104.04 cents last week and from 86.50 cents reported the corresponding period a year ago. Daily average quotations ranged from a low of 102.16 cents Monday, July 25 to a high of 107.01 cents Thursday, July 28.

    Spot transactions reported in the Daily Spot Cotton Quotations for the week ended July 28 totaled 618 bales. This compares to none/zero bales reported last week and 411 spot transactions reported the corresponding week a year ago.

    Total spot transactions for the season were 1,624,764 bales compared to 1,386,959 bales the corresponding week a year ago. The ICE October settlement price ended the week at 102.37 cents, compared to 99.60 cents last week.

    USDA ANNOUNCES SPECIAL IMPORT QUOTA #15 FOR UPLAND COTTON July 28, 2022

    The Department of Agriculture’s Commodity Credit Corporation announced a special import quota for upland cotton that permits importation of a quantity of upland cotton equal to one week’s domestic mill use. The quota will be established on August 4, 2022, allowing importation of 12,148,606 kilograms (55,798 bales of 480-lbs) of upland cotton.

    Quota number 15 will be established as of August 4, 2022 and will apply to upland cotton purchased not later than November 1, 2022 and entered into the U.S. not later than January 30, 2023. The quota is equivalent to one week’s consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period March 2022 through May 2022, the most recent three months for which data are available.

    Future quotas, in addition to the quantity announced today, will be established if price conditions warrant.

    Southeastern Markets Regional Summary

    Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was moderate. Average local spot prices were firm. Trading of CCC-loan equities was inactive. The COVID-19 Pandemic continues to disrupt labor availability and logistics, but cities and locales were easing COVID restrictions.

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    A mix of sun and clouds was observed across the lower Southeast during the week. Daytime high temperatures were in the upper 80s to low 90s. Widespread thundershowers brought precipitation to areas throughout the lower Southeast during the period. Weekly accumulated precipitation totals measured from one-quarter of an inch to one and one-half inches throughout south Georgia to three to four inches of moisture recorded in west Alabama and the Florida Panhandle.

    The beneficial moisture ended drought conditions in portions of north and southeast Georgia, according to theU.S. Drought Monitor. However, moderate and severe drought conditions expanded in areas of north Alabama that missed precipitation. Plants were invigorated in fields that received moisture in recent weeks and producers applied growth regulators and fertilizers. Fields were scouted and producers applied sprays where pest levels met threshold limits. The crop progressed; squaring neared completion and boll-setting advanced.

    According to the National Agricultural Statistics Service’s (NASS) Crop Progress report released July 25, cotton squaring was reported at 90 percent in Georgia and 89 percent in Alabama; boll-setting advanced to 65 percent in Alabama and 51 percent in Georgia.

    Partly cloudy skies were observed across the upper Southeast during much of the week. Daytime high temperatures were in the 90s. Scattered thunderstorms brought moderate precipitation to cotton growing areas of the eastern Carolinas throughout the period. Widespread thunderstorms brought moisture to cotton growing areas of the eastern Carolinas and Virginia during the period.

    Weekly accumulated precipitation totals measured 1 to 3 inches, with locally heavier amounts observed in some areas. Recent rainfall invigorated plants and producers applied growth regulators and fertilizers. Fields were scouted for cotton pests and producers applied insecticides as needed. The crop progressed; squaring and boll-setting advanced.

    According to NASS, squaring advanced to 99 percent in Virginia, 90 in South Carolina, and 76 percent in North Carolina; boll-setting advanced to 64 percent in South Carolina, 61 in Virginia, and 35 percent in North Carolina.

    Textile Mill

    Domestic mill buyers booked a moderate volume of 2022-crop cotton, color 41, leaf 4, and staple 34 and longer for January through December 2023 delivery. No additional sales were reported. Yarn demand remained good, but mills operated at capacity as allowed by available labor. Mills continued to produce personal protective equipment for frontline workers and consumers.

    Demand through export channels was good. Agents throughout the Far East inquired for any discounted styles of cotton.

    Trading

    • No trading activity was reported.

    South Central Markets Regional Summary

    North Delta

    Spot cotton trading was inactive. Supplies of available cotton were light. Demand was very light. Average local spot prices were firm. Trading of CCC-loan equities was inactive. No forward contracting was reported. Variants of the COVID-19 virus continue to appear, causing disruptions that vary from state to state, as well as negatively impacting international marketing channels, domestic supply chains, and the labor force overall.

    Unusually hot and dry conditions prevailed during the week. Daytime temperatures were in the high 90s, and the heat index registered 105 to 110 degrees. Overnight lows were in the high 70s and low 80s. The National Weather Service issued excessive heat and air quality advisories regionally. No rainfall was reported, but the extended forecast calls for the chance of rain in the next few days. Producers were steadily irrigating.

    The crop made erratic progress due to the excessive heat and lack of precipitation. Plant growth regulators were applied sparingly. Blooming was advancing rapidly. Insect pressure from spider mites increased, and fields were treated to control infestations of mites and plant bugs. According to the National Agricultural Statistics Service’s (NASS) Crop Progress report, released on July 25, boll-setting advanced to 79 percent complete in Arkansas, 58 in Missouri, and 51 percent in Tennessee.

    NASS reported that the crop condition in Arkansas was 64 percent good to excellent, 80 percent fair to good in Missouri, and 57 percent fair to good in Tennessee. Virtual and in-person industry meetings were being planned and attended.

    South Delta

    Spot cotton trading was inactive. Supplies of available cotton were light. Demand was very light. Average local spot prices were firm. Trading of CCC-loan equities was inactive. No forward contracting was reported. Variants of the COVID-19 virus continues to appear, causing disruptions that vary from state to state, as well as negatively impacting international marketing channels, domestic supply chains, and the labor force.

    The heat and lack of rain continued to dominate climatic conditions. Less than one-half of an inch was reported in areas that received any moisture at all. Daytime temperatures were in the mid-90s to low 100s. The heat index registered 105 to 110 degrees on several occasions. Overnight temperatures were in the 70s and 80s. Producers were irrigating to the extent possible to promote good fruit set and retention.

    Local experts in Mississippi and Louisiana reported that the crop made good progress under hot weather conditions. Squaring advanced steadily in all areas. Boll-setting expanded and irrigated fields were treated with plant growth regulators. Insect pressure from spider mites and plant bugs increased. Infestations were treated as necessary.

    According to the National Agricultural Statistics Service’s (NASS) Crop Progress report, released on July 25, boll-setting advanced to 83 percent complete in Louisiana and 61 percent in Mississippi. NASS reported that the crop condition in Louisiana was 71 percent good to excellent, and 82 percent fair to good in Mississippi. Virtual and in-person industry meetings were being planned and attended.

    Trading

    North Delta

    • No trading activity was reported.

    South Delta

    • No trading activity was reported.

    Southwestern Markets Regional Summary

    East Texas

    Spot cotton trading was slow. Supplies and producer offerings were light. Demand was light. Average local spot prices were firm. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Interest was best from China, Korea, and Pakistan. Logistics continued to be negatively impacted by the COVID-19 Pandemic.

    Harvesting and ginning expanded in the Rio Grande Valley (RGV) and in the Coastal Bend (CB) with daytime highs in the mid-90s to low 100s. Harvesting had begun in the Upper Coast (UC) where excessive heat had pushed the crop to maturity. The crop was expected to be ready about the same time in the RGV, CB, and UC. Hot, droughty conditions persisted in the Blackland Prairies (BP).

    Irrigated cotton was drought stressed in the southern BP and needed rain. Some fields were treated for insects. In the northern BP, the stands were done, and bolls had begun to open along with natural leaf drop. Harvesting activities were nearby. The Corpus Christi Classing Office reported 7,206 bales graded from the Rio Grande Valley and the Coastal Bend with the season average predominate color 21 was at 55.2 percent, leaf 2 at 62.4 percent, mike averaging 4.16, staple averaging 35.24, and strength averaging 31.10 for week ending July 28.

    In Kansas, cotton squaring was 97 percent compared to the five-year average at 71 percent. Setting bolls was 40 percent, down 27 points from the five-year average, according to the National Agricultural Statistics Service’s (NASS) Crop Progress report released on July 25. Rainfall chances are in the nearby forecast, and urgently needed. Local reports indicated that the plants were slow to progress and experienced boll shed. In Oklahoma, squaring was 68 percent, the same as the five-year average, according to NASS. Setting bolls was at 10 percent, down 12 points from the five-year average.

    West Texas

    Spot cotton trading was slow. Supplies and producer offerings were light. Demand was light. Average local spot prices were firm. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Interest was best from China, Korea, and Pakistan. Logistics continued to be negatively impacted by the COVID-19 Pandemic. According to the Centers for Disease Control and Prevention, the weekly community level was high for Lubbock County.

    A few tenths of an inch of rainfall were received with daytime high temperatures in the low 90s to mid-100s. A moderate chance of rain is in the forecast for the Panhandle, but droughty conditions persisted. Progress included squaring and some stands had begun to bloom. Stands continued to be failed under the crop insurance program. Lots of land has been plowed. Above ground pivots struggled at capacity to deliver enough water to ease heat stress. Stands planted on underground drip systems were faring best in the current drought situation.

    Trading

    East Texas

    • In Oklahoma, a light volume of 2021-crop containing color 31 and better, leaf 3 and better, staple 33, mike averaging 43.6, strength averaging 28.1, and uniformity averaging 79.8 sold for around 96.50 cents per pound, FOB car/truck (compression charges not paid).

    West Texas

    • A 2020 and 2021-crop mixed lot containing a light volume of color 41 and better, leaf 7 and better, staple 35, mike averaging 34.7, strength averaging 28.7, uniformity averaging 79.1, and 25 percent extraneous matter sold for around 89.50 cents per pound, FOB car/truck (compression charges not paid).

    Western Markets Regional Summary

    Desert Southwest (DSW)

    Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were firm. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. The U.S. continues in COVID-19 Pandemic status.

    Hot and dry conditions were the norm in central Arizona. Partly cloudy conditions kept temperatures in the high 90s. Level 1 and Level 2 heat stress was reported early in the period. Local sources reported the crop looked very good in western and eastern Arizona. Some of the crop in central Arizona received wind damage from a monsoon storm several weeks ago. Most of the crop was right on schedule.

    Monsoon activity ramped up late in the period. Flash flood watches were in effect over central and eastern Arizona. Overall, the crop made good progress. Temperatures were mostly in the 90s for New Mexico and El Paso, TX. Scattered shower activity provided additional moisture to fields. Industry experts reported vigor issues in nearly 40 percent of New Mexico fields. It was estimated that some of the crop was about a month behind normal. DSW insect sweeps indicated some whitefly activity.

    San Joaquin Valley (SJV)

    Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were firm. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. The U.S. remains in COVID-19 Pandemic status.

    Hot and dry conditions continued. Many SJV locales reported 17 days of over 100+ degree temperatures. Cotton plants are holding up well. Boll-setting was good. Insect activity was moderate. The crop continued to make good progress. Ginners attended state meetings.

    American Pima (AP)

    Spot cotton trading was inactive. Supplies were light. Demand was good. Average local spot prices were steady. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were moderate. Interest for 2022-crop cotton was very good.

    Little to no carryover kept prices firm for new-crop cotton. Interest was best from India, Indonesia, and Malaysia. According to the Foreign Agricultural Service, U.S. Export Sales report 64,400 bales of Pima cotton were committed for the 2022 marketing year for the week ending July 21. This compares to 5,500 bales the previous year. The U.S. remains in COVID-19 Pandemic status.

    Daytime high temperatures were recorded in the 90s to mid-100s throughout the Far West. Cloudy skies and monsoon activity in the Desert Southwest (DSW) brought around one-tenth of an inch of moisture and kept temperatures below 100 degrees for most of the period. Level 1 and Level 2 heat stress was recorded in the DSW early in the reporting period.

    Industry experts reported the crop was in good to excellent condition for the region. Exceptionally hot July temperatures pushed the crop. Many fields exhibited blooms at the top of plants. Boll loads were good. No significant insect pressures were reported. Overall, the crop made good progress.

    Trading

    Desert Southwest

    • A light volume mixed lot of New Mexico cotton color 11 and 21, leaf 2 and better, staple 36, mike averaging 30.0, strength averaging 28.0, and uniformity averaging 77.8 traded for around 91.50 cents per pound, FOB car/truck (compression charges not paid).

    San Joaquin Valley

    • No trading activity was reported.

    American Pima

    • No trading activity was reported.



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