By Keith Brown, DTN Contributing Cotton Analyst
The cotton market could find no friendly footing Tuesday, ending essentially unchanged. In one sense Tuesday’s muted settlement could be taken as a positive in that USDA posted better-than-expected field condition numbers on Monday afternoon. On the other hand, positive influences stemming from the Dow, crude oil and gold could not inspire cotton to take hold and trade higher.
Looking to Wednesday, the market will key off weather updates. Currently for Texas, there has been something of a slight improvement. While temperatures are anticipated to be above normal, rainfall is forecast to be normal for this time of year. To that end, chances for the Lubbock area to see rain are increased to some degree. What the market may really focus upon is the potential for a tropical depression to form in the Gulf of Mexico. If it were to develop, the current track might be for the Houston, Texas area. However, one never knows with such events.
Then on Thursday, the market will see the weekly export sales report. Given the relationship between China and the U.S. is unraveling, the market lives in fear of seeing significant cancellations. The official end of the 2019/2020 marketing season is July 31. Thus, either those cancellations happen, or those purchases will be rolled into the 2020/2021 season. Interestingly, only about 45% of all old-crop sales have actually culminated with delivery.
For Tuesday, December cotton closed at 62.95 cents, up .07 cent, March ended at 63.61 cents flat, and Dec ’21 settled at 62.96 cents, also flat on the day. Tuesday’s estimated volume was 13,710 contracts.