The week ending Friday, August 19 saw ICE futures peak after rocketing higher the previous Friday, post-WASDE.  The rocket fuel ran out below 120, and the Dec’22 fell back to support around 112, and ended the week with a partial recovery, settling at 116.01 cents per pound (see chart above courtesy of Barchart.com). Dec’23 cotton futures settled Friday at 90.31 cents per pound.  Chinese cotton prices and the A-Index followed a similar pattern as ICE futures.

Cotton-specific influences this week included continued rains over the Cotton Belt, some useful and some not (South Texas)  The week saw a continuation of very light-to-moderate demand in inactive/slow  physical trading,  weak export sales, and on-par export shipments.   U.S. boll setting and opening progress were a little above the average pace, respectively.  On the other side of the world, the Indian monsoon rains were normal to excess in the important west-central cotton growing states, as well as in Pakistan.

ICE cotton futures open interest mostly rose across the week, reflecting some new buying in the post-WASDE rally.  Indeed, the regular Tuesday snapshot of speculative positioning (through August 16) showed 6,075 more hedge fund longs, reinforced by 4,397 fewer (liquidated) hedge fund shorts, week over week.  The index fund net long position, was little changed with only 678 fewer longs week over week.  So the speculative influences appear to have switch their six week decline and reacted to the August WASDE surprise.

In contrast to ICE cotton, CBOT new crop corn and soybean futures, as well as KC wheat futures, all showed a modest downtrend this week. The U.S. dollar index rose steadily, buoyed by weakness in competing currencies and hawkish Federal Reserve stances.

For more details and data on Old Crop and New Crop fundamentals, plus other near term influences, follow these links (or the drop-down menus above) to those sub-pages.