U.S. intended upland planting showed increases of 2.3% from last year in the Southeast and 5.7% in the Southwest, with decreases of 0.1% and 6.8% foreseen in the Midsouth and West, respectively. Upland 2017-crop classing reached 18.243 million RB, about 91% of the production estimate.
Cotton futures reversed off earlier gains to start a new week slightly lower in old-crop contracts Monday.
Spot March settled down 23 points to 76.45 cents, in the lower third of its 137-point range from up 79 points at 77.47 cents to down 58 points at 76.10 cents. It pushed above Friday’s high, stalled five ticks shy of Thursday’s high and held on the downswing 36 ticks above Friday’s low.
May closed down 18 points to 77.45 cents, July settled down 14 points to 78.44 cents and December finished up 22 points to 75.74 cents. Index fund rolling from March is scheduled to end this week.
Volume rose to an estimated 78,100 lots from a final 69,685 lots the previous session when spreads accounted for 47,428 lots or 68%, block volume 500 lots, EFS 500 lots and EFP 225 lots. Options volume slowed to 3,541 lots (1,581 calls and 1,959 puts) from 7,577 lots (3,350 calls and 4,227 puts).
Some mild surprises were seen in the National Cotton Council’s 37th annual early survey showing U.S. producers intend to plant 13.078 million all-cotton acres, up 3.7% from 12.612 million acres last year.
The survey, mailed in mid-December with responses collected through mid-January, showed intentions of 12.824 million acres of upland, up 3.8% from 12.36 million, and 254,000 acres of Pima, up 1% from 252,000 acres.
By regions, producers reported intentions to increase upland plantings 2.3% to 2.582 million acres in the Southeast and 5.7% to 8.007 million in the Southwest, while indicating plans for reductions of 0.1% to 1.943 million acres in the Mid-South and 6.8% to 293,000 in the Far West.
Cotton futures prices were stronger than those of competing crops during the survey period, the NCC noted. The price ratios of cotton to corn and soybeans are more favorable than in 2017. However, soybeans are expected to provide competition owing partly to lower production costs.
And cottonseed prices are the lowest since the 2006-crop marketing year, thus increasing the net costs of ginning.
In Texas, the largest cotton-producing state, upland acreage is expected up 3.7% to 7.154 million on plans for more wheat and less corn and “other crops.” In Georgia, the No. 2 cotton state, growers reported intentions to increase cotton acres 0.6% to 1.287 million, reduce soybeans and increase corn and other crops.
On the old-crop scene, U.S. upland classing slowed to 354,825 running bales during the week ended Thursday from 427,966 RB the prior week, bringing the total for the season to 18.243 million RB.
Classing reached roughly 91% of the estimated upland production and was up about 17% from 15.628 million RB graded a year ago. About 97% of the final output had been classed at the corresponding point last year.
Tenderable cotton dipped to 68.9% for the season from 69.3% a week earlier and 70.3% a year ago. Gins submitting samples for grading declined to 180 from 218 the week before and 534 for the season.
Pima classing slipped to 17,708 RB from 18,215 RB the previous week to bring the extra-long staple count for the season to 628,942 RB, up from 510,385 RB a year ago.
Futures open interest fell 14,638 lots to 271,059 on Friday, with March’s down 21,546 lots to 51,736 and May’s up 3,477 lots to 107,026. Certified stocks increased 1,669 bales to 78,953. The additions were at Galveston where 2,061 bales awaited review.Source: Agfax