USDA Weekly Cotton

 

Mp_cn812 
July 13, 2018 
Weekly Cotton Market Review 
 
 
Average quotations were 292 points higher than the previous 
week, according to the USDA, Agricultural Marketing Services 
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, uniformity 81.0-81.9) in the seven 
designated markets averaged 83.34 cents per pound for the week 
ending Thursday, July 12, 2018. The weekly average was up from 
80.42 last week and from 65.52 cents reported the corresponding 
period a year ago. Daily average quotations ranged from a low 
of 81.74 cents Wednesday, July 11 to a high of 85.67 cents 
Thursday, July 12. Spot transactions reported in the Daily Spot 
Cotton Quotations for the week ended July 12 totaled 8,353 bales. 
This compares to 2,460 bales reported last week and 239 spot 
transactions reported the corresponding week a year ago. Total 
spot transactions for the season were 2,056,439 bales compared 
to 1,564,064 bales the corresponding week a year ago. The ICE 
October settlement prices ended the week at 89.24 cents, compared 
to 82.71 cents last week. 


Southeastern Markets Regional Summary


Spot cotton trading was inactive.  Supplies  and producer offerings 
were light.  Demand was moderate.  Average local spot prices were 
higher. Trading of CCC-loan equities was inactive. 
     
Seasonably hot and muggy conditions dominated the weather pattern 
across the lower Southeast with daytime high temperatures in the 
upper 80s to mid-90s. Afternoon pop-up thundershowers blanketed 
areas throughout north and south Alabama, the Florida Panhandle, 
and portions of south Georgia during the period.  Weekly accumulated 
rainfall totals measured from one-half of an inch to two inches, 
and in some areas locally heavy downpours delivered heavy amounts 
of moisture in short periods of time.  Wet conditions hindered 
spraying and interrupted fieldwork in some locales. In between 
rain events, producers made fungicidal applications and treated 
fields with insecticides that met threshold limits.  Many counties 
missed significant precipitation despite the widespread rainfall, 
but most of the lower Southeast remained drought-free, according 
to the U.S. Drought Monitor.  According to the National Agricultural 
Statistics Services (NASS) Crop Progress report released July 9, 
squaring advanced slightly ahead of the five-year average in Georgia, 
but lagged behind 9 points in Alabama; boll-setting advanced at a good pace. 
     
Fair to partly cloudy weather conditions prevailed throughout the 
Carolinas and Virginia during the period with daytime high 
temperatures in the upper 80s to upper 90s.  Light variable 
rainfall was received in portions of the central Carolinas and Virginia.  
Weekly accumulated rainfall totals measured around one-quarter to one-half 
of an inch, with slightly heavier accumulations observed in localized areas.  
The crop progressed well under the seasonably hot and muggy conditions.  
Spider mites were present at treatable levels in some droughty cotton; 
pressure was light in wetter areas.  Aphid populations were building in 
fields across the upper Southeast.  Producers scouted fields for tarnished 
plant bugs (TPB); the Environmental Protection Agency has granted a 
Section 18 Emergency Exemption for Transform WG insecticide in North 
Carolina and certain counties in Alabama for control of TPB in cotton.  
According to the NASS Crop Progress report released July 9, squaring 
advanced slightly ahead of the five-year average in North Carolina 
and Virginia, but lagged 4 points behind in South Carolina; boll-setting 
was getting underway. 
 
Textile Mill 

Demand was good for 2018-crop cotton, color 41, leaf 4, and staple 34 
and longer for December 2018 through first quarter 2019 delivery.  No 
sales were reported; most mills have covered their immediate to nearby 
raw cotton needs.  Most mills operated five to seven days.  Load out 
dates at most warehouses were reported at eight to ten weeks. 
     
Demand through export channels was moderate.  Demand was good throughout 
the Far East for any discounted or low-grade styles of cotton. 

Trading 
..
A light volume of mostly color 31 and 41, leaf 2-4, staple 32-34, mike 42-51, 
strength 24-30, and uniformity 79-83 sold for around 78.00 cents per pound, 
FOB car/truck (Rule 5, compression charges paid). 


South  Central Markets Regional Summary 


North Delta
 
Spot cotton trading was inactive.  Supplies of available cotton were light.  
Demand was light.  Average local spot prices were higher.  Trading of CCC-loan 
equities was inactive. No forward contracting was reported. 

The crop made good progress under hot temperatures.  Daytime high temperatures
were in the mid-90s; heat indexes as high as 103 degrees prompted the National 
Weather Service to issue regional heat advisories.  Overnight lows were in the 
low 70s.  A series of thunder showers provided light amounts of beneficial 
precipitation to some cotton-producing areas of the region; areas of abnormal 
dryness were eliminated in Tennessee, according to the U.S. Drought Monitor. 
However, areas of abnormally dry-to-moderate drought conditions expanded in 
central Arkansas.  Producers were irrigating to maintain adequate soil moisture 
levels, which generally existed in Missouri.  Insect pressure from plant and stink 
bugs was heavy in some areas.  Fields were treated as necessary. Fields in drier 
areas were also treated for spider mites.  The hot weather and adequate moisture 
have required the application of plant growth regulators in many places.  Squaring 
expanded rapidly and remained about a week ahead of the five-year average throughout 
the region.  Blooming was widespread and ahead of normal in all areas. 

South Delta 

Spot cotton trading was inactive.  Supplies of available cotton were light.  
Demand was light.  Average local spot prices were higher.  Trading of CCC-loan 
equities was inactive.  No forward contracting was reported. 
 
The crop made good progress under hot weather conditions. Daytime high 
temperatures were in the mid-90s. Overnight temperatures were in the low 70s. 
Widely scattered storm systems brought approximately 2 inches of beneficial 
precipitation to some cotton-producing areas of the region. Dryland 
cotton has begun to cut-out.  Insect pressure from plant bugs and aphids was 
reported in some fields which were treated as necessary to control infestations. 
Plant growth regulators were being widely applied, particularly in areas where    
the crop is progressing rapidly. Squaring was virtually completed and blooming 
was widespread.  According to the U.S. Drought Monitor, abnormally dry-to-moderate 
drought conditions existed throughout Louisiana; Mississippi was abnormally dry. 
 
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 demand were light.  Average local 
spot prices were higher.  No forward contracting or domestic mill activity was 
reported.  Trading of CCC-loan equities was inactive. Foreign inquiries were 
light and mostly for new-crop price discovery.  Mills remained on the sidelines 
as ICE futures trended lower, but trended higher as the week progressed. 
Merchants reported mill interest for Australian and Brazilian cotton. Overall, 
market conditions reflected the typical summer pattern.   
     
Scattered showers early in the reporting period disrupted on-going defoliation 
activities in the Coastal Bend and Rio Grande Valley (RGV). Some locales received 
one-quarter of an inch to one and one-half inches. Some fields were too soggy to 
support equipment.  Recent rainfall was beneficial to the Upper Coast crop.  
Mostly clear, sunny skies dominated the weather pattern in the Coastal Bend, 
RGV, and Upper Coast mid-week.  Defoliation was expected to ramp up late in 
the period in the Coastal Bend and RGV.  A few fields will be ready to harvest 
next week.  Initial ginning was expected to begin late next week.  Local sources 
reported the Kansas crop appeared to be slightly behind schedule, maybe due 
to damage from wind and hail early in the growing season.  The crop in eastern 
Kansas was in good shape. In Oklahoma, dryland acreage in western Oklahoma is 
struggling under intense drought conditions.  Rainfall is desperately needed 
to help the crop flourish.  Local experts reported that the Lugert-Altus 
Irrigation district could not provide a full irrigation schedule, due to 
low water levels.  Extension crop specialists promoted proper use of weed 
and pesticide control products. A few situations of herbicide/pesticide drift 
were reported. Overall, the crop continued to progress in Oklahoma.  
Warehouses in Oklahoma and Kansas continued to receive and ship cotton.   
 
West Texas 

Spot cotton trading was inactive.  Supplies and producer offerings were light.  
Demand was light.  Average local spot prices were higher. A light volume of 
forward contracting was reported.  No domestic mill activity was reported. 
Trading of CCC-loan equities was inactive.  Foreign inquiries were light. 
Mills remained on the sidelines as ICE futures trended lower, but trended 
higher as the week progressed. Overall, market conditions reflected the 
typical summer pattern.   
     
Hot, dry conditions continued for the west Texas region.  Temperatures were 
in the low 90s for most of west Texas. Scattered showers brought one-third 
of an inch of moisture early in the period. Heat and strong winds depleted 
topsoil moisture almost as rapidly as it was received.  Dryland acreage 
continue to struggle for lack of moisture.  Irrigated acreage made good 
progress.  Local sources reported that the industry was waiting to hear 
about final abandonment numbers.  Extension crop specialists promoted 
proper use of weed control products 

Trading 
 
East Texas 
..
In Kansas, a light volume of mostly color 31 and 32, leaf 3 and better, 
staple 34 and 35, mike 32-34, strength averaging 28.9, uniformity averaging 
79.6, and 50 percent extraneous matter sold for around 68.00 cents per pound, 
FOB car/truck (compression charges not paid).    
..
A light volume of mostly color 32 and 33, leaf 3 and better, staple 33 and 34, 
mike 31-37, strength averaging 28.1, uniformity averaging 79.3, and 25 percent 
extraneous matter sold for around 64.00 cents, same terms as above.   
..
In Oklahoma, a light volume of color 21 and 31, leaf 3 and better, staple 36 
and 37, mike averaging 32.0, strength averaging 29.4, and uniformity averaging 
80.5 sold for around 73.00 cents, same terms as above. 
..
A mixed lot containing a light volume of mostly color 33, leaf 3 and better, 
staple 33-35, mike 36-41, strength averaging 26.7, uniformity averaging 79.9, 
and 75 percent extraneous matter sold for around 64.50 cents, same terms as above.    
 
West Texas 
..
A moderate volume of mostly color 41 and better, leaf 3 and better, staple 31-33, 
mike 31-50, strength averaging 27.9, uniformity averaging 78.5, and 25 percent 
bark traded for around 71.50 cents, FOB car (compression charges not paid.) 
..
A light volume of color 33, leaf 2 and better, staple 33-37, mike 37-40, strength 
averaging 29.4, uniformity averaging 80.4, and 25 percent bark traded for around 
60.00 cents, same terms as above.   


Western Markets Regional Summary


Desert Southwest (DSW) 

Spot cotton trading was inactive.  Supplies and demand were light.  Average 
local spot prices were higher.  No forward contracting or domestic mill 
activity was reported.  Foreign mill inquiries were light.   
     
Monsoon activity lowered temperatures from the high 110s to low 100s early 
in the period. Rainfall accumulations were around one-quarter of an inch 
to just over one-half of an inch in western and central Arizona.  Monsoons 
produced thunderstorms and strong winds throughout Arizona.  Strong winds 
knocked a few bolls off in Yuma, but no serious damage was reported.  The 
Yuma crop was past peak bloom and boll-setting advanced.  A flash flood 
advisory for the Gila River was in effect as heavy rainfall and run off 
in higher elevations threatened communities near Safford.    
 
San Joaquin Valley (SJV) 

Spot cotton trading was inactive.  Supplies and demand were light.  Average 
local spot prices were higher.  No forward contracting or domestic mill 
activity was reported.  Foreign mill inquiries were light in a typical 
summer pattern.    
     
Triple-digit temperatures in the low 100s prevailed.  No moisture was 
recorded in the period. Fields were blooming.  Local experts reported 
the crop was in good condition and little to no insect pressure.       
 
American Pima (AP) 

Spot cotton trading was inactive.  Supplies and demand were light. 
Average local spot prices were steady.  No forward contracting or 
domestic mill activity was reported.  Foreign mill inquiries were light.   
     
The crop continued to make good progress under hot and mostly dry conditions.  
Arizona, New Mexico, and El Paso, Texas received monsoon moisture of around         
one-quarter of an inch up to one-half of an inch. The moisture was 
welcomed in drought parched areas of New Mexico. Strong winds and heavy 
downpours created hazardous driving conditions.  Light wind damage was 
reported in some Yuma, Arizona fields.  Yuma fields were past peak bloom.  
Boll-setting and retention was good.  Blooming gained momentum in the 
San Joaquin Valley.   

Trading 
 
Desert Southwest 
..
No trading activity was reported. 

San Joaquin Valley 
..
No trading activity was reported. 

American Pima 
..
No trading activity was reported. 


USDA ANNOUNCES SPECIAL IMPORT QUOTA #12 
FOR UPLAND COTTON 
July 12, 2018 


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 weeks domestic mill use. 
The quota will be established on July 19, 2018, allowing importation of 
13,673,800 kilograms (62,803 bales) of upland cotton.  
     
Quota number 12 will be established as of July 19, 2018, and will apply to 
upland cotton purchased not later than October 16, 2018, and entered into 
the U.S. not later than January 14, 2019. The quota is equivalent to one 
week's consumption of cotton by domestic mills at the seasonally-adjusted 
average rate for the period March 2018 through May 2018, the most recent 
three months for which data are available.  
     
Future quotas, in addition to the quantity announced, will be established if 
price conditions warrant.  




 



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