DTN Cotton Close: Market Follows Grains Higher
DTN Cotton Close: Market Follows Grains Higher

DTN Cotton Close: Market Follows Grains Higher

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The cotton market finished moderately higher Thursday afternoon after suffering some early bearish pain. There was a lack of news as weekly sales and exports are delayed until Friday morning. Still, cotton held its ground as the weather adversities occurring across the belt do not seem to be abating. In fact, the forecast calling for some rain this weekend for South Georgia has been pushed farther out.

Thus, cotton followed the recovery in the grain markets to produce a higher close. In addition to the export-sales data, Friday also is the last day of the month. With certain speculators holding net short positions, one wonders if those traders will feel somewhat compelled to buy back some of their bearish positions.

The immediate rhetoric coming out of China’s media outlets has not been conductive at all towards striking a trade deal with America. Quite the contrary! From various articles and editorials we have read, China seems to be announcing, in a not so subtle way, that it is in this trade war for the long haul. Supposedly, Presidents Trump and Xi are to meet at the G-20 meeting last June. Hopefully, the two leaders can get the negotiations back on track.

As stated, Friday USDA will issue its latest sales and exports data. Last week saw the combined crop years sales in exceed of 500,000 bales. That number put old crop sales beyond USDA original export target. Unfortunately, at last count, new crop sales were running behind some 25% of where they historically should be for this of year. The trade war and China internal auctions are no doubt effecting that pace.

For Thursday, July cotton closed at 69.34 cents, up 0.28 cent, December finished at 68.32 cents, up 0.34 cent and March ended at 68.94 cents, up 0.35 cent. Friday’s estimated trading volume was 23,128 contracts. Thus far, for the week, December cotton is up 0.77 cent, but is down some 7.40 cents for the month.

Source: Agfax

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