By Keith Brown, DTN Contributing Cotton Analyst
Spot December cotton made new highs, as well as posted a new high close for its current move. That “Bull Move” started on April 2, when the market bottomed out from the COVID-19 fears. Since that time, cotton has enjoyed a strong uptrending ride. There are several reasons for its turnaround, including speculators reversing their net positions from short to net long, China began fulfilling its phase-one obligations, the U.S. dollar weakened and several yield-reducing weather events have “banged” the 2020 crop. Thus, instead of being down 23 cents on the year, spot December is down a mere 2.77 cents.
Traders are monitoring Hurricane Delta. Currently, it is expected to ricochet off Mexico, before heading towards the coast of Louisiana. Some analysts expect Delta will build to a category 4 hurricane prior to its making landfall. To that end, the six- to 10-day forecast has above normal rainfall for across the U.S. Delta and the Southeast. The 2020 crop stands at 80%+ open.
Thursday, USDA will issue its weekly export sales. with a sideways to weaker dollar, sales are expected to be fairly strong.
December Cotton closed at 67.59 cents, March closed at 68.35 cents, up 0.63 cent and December 2021 finished at 67.29 cents, up 0.57 cent. Estimated volume was 31,523 contracts.