Currently, spot March is threatening to exceed its harvest lows of October 1 at 76.50 cents. In fact, it’s only Wednesday and the market is nearly down three hundred points for the week! As we understand it, the next round of talks between the U.S. and Chinese trade officials will be early January. U.S. officials have warned investors not to trade the markets based on the day-to-day news coming from the meetings, but rather wait for the March 1 deadline to see resolution has been reached.

However, China agreed at the outset of the 90-day trade truce she would buy a huge amounts of U.S. agricultural products. It has bought some U.S. beans, but has yet to officially buy U.S. cotton. In fact, we have not heard cotton being mentioned in any text or comments.

The Federal Reserve indeed hiked interest rates Wednesday one-quarter point, but then added what is being call “dovish” comments. Those comments indicate the Fed has lowered its outlook for 2019 interest increases from three to two. Initially, the Dow rallied, but promptly fell off. The U.S. dollar slightly strengthen.

Thursday, USDA will report on weekly sales and exports. Again, given the weaker tenor of recent reports, we are not looking for massive amounts of sales. However, given USDA’s last crop report, the government indicated big reductions in the crops of India, China, Pakistan and Turkey. At some point into 2019, those production setbacks ought to be the basis for more U.S. Sales.

March cotton settled at 76.71 cents, down 1.14 cents, July was 79.13 cents, off 0.95 cent and December 2019 closed at 76.33 cents, down 0.50 cent. Wednesday’s estimated volume was 26,900 contracts traded.