By Keith Brown, DTN Contributing Cotton Analyst
December cotton finished Wednesday fractionally lower. Some traders are concerned the final election outcome could drag on for weeks. That uncertainty has them paring some net-long positions. It was one week ago when spot December fell short of its 73.00 January high, reversed, and cascaded all the way to 68.06. Even with that decline, the market remains generally overbought as speculators continue to carry a huge net-long position. Cotton’s total open interest peaked on Oct. 28 at 249,451 contracts. Currently, the open interest stands at 246,156 contracts. This Friday the CFTC will update its Commitments of Traders data. At last count, certain managed-money speculators were net long some 65,000 contracts, equivalent to 6.5 million bales.
Thursday, USDA will issue its Weekly Export Sales and Shipments report. Last week’s number was 225,000 contracts with Pakistan as the top buyer with 125,000 bales. Traders anticipate a similar sales total for Thursday’s report.
On Friday, the Labor Department will update the unemployment rate via its jobs data. Despite the adverse effects of COVID-19, the U.S. economy has been in a strong recovery. Friday’s unemployment rate is expected to fall to 7.7%, down from last month’s 7.9% rate. At the peak of COVID, the U.S. unemployment rate hit 25%, plus or minus.
Wednesday, December cotton closed at 70.23 cents, down 1 cent; March settled at 71.19 cents, off 1 cent; and 2021 December finished at 69.63 cents, minus 7 cents. Wednesday’s estimated volume was 36,533 contracts.