By Keith Brown, DTN Contributing Cotton Analyst
The cotton market closed materially higher Tuesday, driven up by bullish outside market influences and fundamental ideas that the 2020 crop is deteriorating. Since Friday’s close, the Dow has rallied back some 1,100 points, which has floated a lot of boats. Additionally, traders anticipate the 2020 cotton production is much less than USDA’s last crop report. There will be a new update on Nov. 10, when USDA releases its next supply and demand report.
The U.S. dollar was lower Tuesday as currency traders are two-sided in their election beliefs. One camp thinks a democratic victory will result in more stimulus, while a republican win could signal less government financial involvement.
The market is also awaiting Thursday’s export sales. Of late, Pakistan has come out as the lead buyer of U.S. cotton. As the world’s fourth largest cotton producer, some traders are wondering whether the Pakistani crop has suffered yield loss from adverse weather and insects.
Tuesday, December Cotton closed at 70.24 cents, up 1.51 cents, March settled at 71.20 cents, up 1.48 cents and December 2021 finished at 69.70 cents, 1.19 cents higher. Estimated volume was 39,859 contracts.
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