U.S. export commitments held a lead of 2.454 million RB over year-ago cumulative sales. Shipments continued to lag the pace needed to achieve the USDA estimate. U.S. far east premium narrowed three points.
Cotton futures fell to steep closing losses Friday, reversing off new contract highs in current-crop deliveries and snapping a string of 10 consecutive calendar-week gains in spot March.
March settled down 124 points at 78.01 cents, below the prior-session low and in the lower quarter of its 224-point range from up 80 points at 80.05 to down 144 points at 77.81 cents. It lost 62 points for the week after the longest streak of weekly gains since 1998.
May closed down 108 points to 78.25 cents, trading within a 141-point range from 79.95 to 78.04 cents, and July finished down 101 points, trading within a 160-point range from 80.09-to-78.49 cents.
The other contracts settled down seven to 69 points, with December down 38 points to 74.36 cents after it too printed a new high at 74.85.
Volume quickened to an estimated 40,100 lots from 27,082 lots the prior session when spreads accounted for 11,215 lots or 41% and EFP 384 lots. Options volume rose to 13,345 lots (5,366 calls and 7,979 puts) from 11,048 lots (5,088 calls and 5,960 puts).
Net U.S. all-cotton export sales for shipment this season of 199,400 running bales during the week ended Dec. 28, up from 176,500 RB the previous week, boosted 2017-18 commitments to 11.251 million RB.
Commitments — outstanding sales of 7.841 million RB plus shipments — held a lead of 2.454 million RB or 28% over year-ago bookings and totaled 78% of the USDA export forecast. A year ago, commitments were 61% of final 2016-17 exports.
All-cotton shipments dipped to 218,900 RB from the prior week’s crop year high of 296,900 RB. Exports for the season of 3.41 million RB trailed year-ago shipments by 599,000 RB or 15% and were 24% of the USDA projection, compared with 28% of final exports last year.
To achieve the estimate, shipments need to average roughly 364,900 RB a week over the 30 weeks remaining in the marketing year, while weekly sales averaging approximately 103,500 RB would match the export forecast.
New-crop sales of 93,200 RB, up from 32,500 RB the previous week, raised 2018-19 commitments to 1.273 million RB, widening the lead over forward bookings a year ago to 708,000 RB.
On the competitive-pricing front, the average of the five lowest-quoted world growths for the Far East edged up 24 points to 87.91 cents during the week ended Thursday, according to USDA calculations, while the lowest-priced U.S. growth landed there gained 27 points to 87.69 cents.
The U.S. discount thus narrowed three points to 0.22 of a cent. The adjusted world price for the week ending next Thursday is figured at 70.86 cents, reflecting transportation and quality differentials. This of course leaves the marketing loan gain at zero.
The fine count adjustment for 2017-crop qualities better than 31-3-35 widened to 50 points from 33 points. This represents differences between premiums in U.S. and international markets.
Futures open interest expanded 2,519 lots to 285,426 on Thursday, with March’s up 1,741 lots to 173,532 and May’s down 882 lots to 54,100. Certified stocks grew 76 bales to 47,665, the first increase in a long time.
Source: Agfax