December Cotton closed lower Friday as China threatened additional tariffs on U.S. products. Earlier in the day, the stories from several major newswires indicated China was going to implement news tariffs on some $60 billion worth of U.S. goods. However, the big negative of the story was the two sides, the U.S. and China, are not even in current trade negotiations. Thus, December Cotton dropped nearly two-hundred points down, before short-covering brought prices to double-digit losses.
Thursday’s weekly sales and exports did show some cancellations in both crop years by China. To that end, as of July 26, cumulative cotton sales at 47.6% of 2018-19 forecast versus a five-year average of 27.9%. Sales of 141,000 bales are needed each week to reach USDA’s forecast.
December Cotton settled 8812, down 71, March 19, 8808 down 67, and December 2019, 8142, down 5 points. Today’s estimated volume was 27,000 contracts.