By Keith Brown, DTN Contributing Cotton Analyst
The cotton market was down Wednesday in response to the sharply lower financial markets, mainly the Dow Jones. On fears of a second coming of COVID-19, the Dow was off over 700 points, and pretty much sucked all the bullish air of all rooms. Corn, cattle, copper and cotton were all measurably lower. However, spot cotton did see 170-plus deliveries against the soon ending old crop contract. Yet, those bales were swapped between a domestic merchant to an international shipper. Delivery for July cotton extends into July 7.
Thursday, USDA will report on export sales. The hope is China will be in for another huge slug of cotton. Of course, there remain fears China is deliberately hedging with U.S. purchases till it can see its way clear to buy cotton from South America. In fact, supposedly Brazil has become ground zero for the coronavirus in the Southern Hemisphere, closing some ports and reducing the shipping activities of others.
For the moment, the Texas crop may be shaping up to be calamitous. Much of West Texas and the Panhandle are sporting drought conditions. There are forecasts suggesting some rain will soon fall, but weather can be fickle as anything.
July cotton closed at 61.06 cents, down 1.38 cents, December finished at 59.21 cents, down 0.23 cent and March settled at 59.80 cents, down 0.33 cent. Estimated volume was 13,076 contracts.
Source: Agfax