By Keith Brown DTN Cotton Correspondent
There was no bullish traction for the market Monday as the 2019 Harvest begins to pick up momentum. Last week, much of the cotton belt was hit with episodes of rain, halting gathering in several locations. Thus, a resumption of harvest ushered in hedge-type selling, and that drove prices off. Additionally, speculators added to their short position.
It was hoped in some trading camps that speculators would have been at a neutral position, if not fractionally bullish given the market’s recent rally. Anyway, they net sold some 1,800 contracts last week, pushing their net short position from roughly 4,100 contacts net short to like 6,200 contracts short.
Monday afternoon, at 4 p.m., USDA will update the progress of the current harvest. It is expected to be about the 50% mark. However, in conversations with producers across the cotton belt, they indicated they were nearly two-thirds done.
Even a strong Dow Jones could not temper Monday’s falling cotton market. To that end, the Dow and the S&P posted new all-time highs. It is generally thought a strong Dow signals a strong economy and therefore increased demand for certain raw materials.
Later this week, the market will deal with weekly exports-sales, December’s options expiration, and a monthly supply-demand report.
December cotton closed at 63.66 cents down, 0.57 cent, March ended at 65.27 cents, down 0.37 cent and December 2020 closed at 67.57 cents, up 0.05 cent. Monday’s estimated volume was 49,740 contracts.