By Keith Brown, DTN Contributing Cotton Analyst
The cotton market finished higher Wednesday as traders eye the unfolding scary situation between India and China. Although the two countries have been in border dispute for decades, just this week the situation greatly intensified. In a clash between Indian and Chinese troops, some 20 Indian soldiers were killed.
Of course, India and China are the top two cotton countries in the world, with India ranked the No. 1 producer. However, both are nuclear powers and traders fear if push comes to shove, it may be more than the global cotton industry in jeopardy. To that end, it is conceivable that both countries halt doing business with one another, and with South America suffering from COVID-19, the U.S. could be the only cotton game in town. Thus, the cotton market traded up Wednesday.
Additionally, despite ideas of a second COVID-19 uprising, the U.S. and global economies continue to handily reopen. Recent U.S. reports show the domestic economy is posting record levels in terms of retail sales. Still, Thursday’s weekly export sales will affect prices.
The current weather forecast for the Texas panhandle indicates at least a 50% chance for rain Friday over some very parched fields. Such an event would likely put downward pressure on cotton prices.
July cotton closed at 61.34 cents, up 1.27 cents, December finished at 60.00 cents, up 0.92 cent and March settled at 60.53 cents, up 0.99 cent.
Source: Agfax