By Keith Brown, DTN Contributing Cotton Analyst 

The cotton market could not muster any upside enthusiasm; another round of poor weekly export sales and a wobbly Dow proved to be too much negativity. A spike in COVID-19 infections causing an increase in weekly claims roiled the stock markets down. For some time, the Dow has traded in a sideways fragile state, thus it took little in the way of bearish fundamentals to tip it over. Often cotton follows the tug and pull of the financial markets.

Also Thursday, the cotton market saw negative to smaller sales. USDA reported a second consecutive week of net negative for the old crop, and small Chinese participation in the new crop. To that end, the U.S. and China are embroiled in an espionage fight involving two U.S.-based Chinese consulates. China has threatened big time retaliation but seems to be giving the Trump administration some time to rethink its position.

The U.S. dollar posted a new low for 2020 and traded below the January low of 2019. The break in the dollar has been prompted by the inability for America to control COVID-19. Ordinarily, a weak dollar is a strong positive for U.S. exports, especially the agricultural sector, but presently there seems to be too many converging global negatives to allow that aspect to work.

December cotton closed at 61.92 cents, down 0.62 cent, March settled at 62.63 cents, down 0.63 cent and December 2021 ended at 62.17 cents, down 0.48 cent. The estimated volume was 12,999 contracts