By Keith Brown, DTN Contributing Cotton Analyst
The cotton market finished slightly higher Wednesday as prevailing hot and dry conditions will persist over the next week, according to the six- to 10-day outlook.
The cotton market finished slightly higher Wednesday as prevailing hot and dry conditions will persist over the next week, according to the six- to 10-day outlook. Chart-wise the trend remains strong, which encourages speculators to hold long. Additionally, the U.S. and China will review the phase-one agreement on August 15. To that end, trading in the mid 60-cent range is no panacea for farmers and tempers the demand prospects. The market has already been reeling under the impact of the global pandemic as lockdowns to prevent the spread of the virus cut demand.
The U.S. dollar continues to slide, as it posted a new two-year low in Wednesday’s trade. A weak dollar makes commodities priced in the U.S. greenback more affordable by foreign customers.
Thursday, USDA will issue its weekly export sales data. This report will supposedly be the last data entries for the 2019-20 crop. Thus, given the amount difference between cotton sold to China, and cotton shopped, some traders are expecting a bullish adjustment of sorts.
For Wednesday, December cotton closed at 64.56 cents, up 0.45 cent, March ended at 65.13 cents, up 0.42 cent and December 2021 finished at 63.82 cents, up 0.34 cent. Estimated volume was 24,907 contracts.