By Keith Brown, DTN Contributing Cotton Analyst 

The cotton market finished markedly lower Tuesday as traders became overly nervous with the Dow Jones’ high volatility. At one time Tuesday, the Dow was off 550 points. It’s something of a broken record to continually link the U.S. equity markets to the cotton market, but strong stock market prices can reflect underlying apparel demand for cotton.

Another possible negative for cotton was news that the Trump Administration is considering a ban on Chinese textile goods produced in the Xinjiang province based on human rights issues. Allegedly, the Chinese are using forced labor to run its mills. Last week the European Union supposedly instituted a ban, thus now the U.S. is mulling one as well.

Tuesday afternoon, USDA will update the condition of the 2020 crop. Last week the Crop was rated 44% good to excellent, down from its prior reading of 46% good to excellent. To that end, China has suffered from heavy rains, causing huge flooding and landslides. The majority of the rains originated from Typhoon Higos. Supposedly, thousands of acres of farmland was flooded and some 200 people perished.

The U.S. dollar finished stronger Tuesday, as the possibility of new federal stimulus seems less likely. Last week’s strong showing of the unemployment rate, moving from 10.5 % down to 8.4%, are causing some lawmakers to show some fiscal restraint.

For Tuesday, December cotton settled at 64.02 cents, down 0.97 cent, March ended at 65.05 cents, down 0.92 cent and December 2021 finished at 64.88 cents, down 0.80 cent. Estimated volume was 38,934 contracts.