Cotton futures settled an inside day slightly lower Thursday amid positioning for the USDA supply-demand report on Friday.
Spot December closed down 31 points to 76.76 cents, a little below the midpoint of its 152-point range from 76.22 to 77.74 cents. March settled down 33 points to 78.86 cents, trading from 78.31 to 79.57 cents.
Volume declined to an estimated 32,400 lots from 40,560 lots the previous session when spreads totaled 223,631 lots or 56%, EFS 596 lots and EFP 21 lots. Options volume slipped to 2,829 calls and 2,150 puts.
Net U.S. all-cotton export sales for shipment this season topped expectations at 306,800 running bales during the week ended Oct. 31, boosting 2013-14 commitments to 5.279 million RB.
Upland net sales of 303,700 bales were the largest since the week ended April 25, not counting the rollover of unshipped sales from last season at the beginning of the marketing year on Aug. 1.
Expectations had been for upland sales slightly larger than the weekly average of about 204,000 bales reported in a lump sum — because of the government shutdown — for the previous three weeks.
The gap behind cumulative sales a year ago narrowed to 1.079 million bales or 17%. Commitments were 52% of USDAΆs September forecast, compared with 50% of final shipments at the corresponding point last season.
Sluggish all-cotton shipments of 94,400 running bales brought exports for the season to 1.856 million RB. The margin behind exports a year ago widened to 180,000 bales or about 9%. Shipments were about 18% of the USDA projection, against around 16% of final exports a year ago.
To achieve the USDA estimate, shipments need to average roughly 217,000 running bales a week and sales approximately 127,000 bales.
Big crops the last three years in Brazil and Australia have resulted in sharply higher Southern Hemisphere exportable supplies, intensifying export competition and affecting U.S. shipping patterns, according to analysts with USDAΆs Foreign Agricultural Service.
U.S. exports have declined in the first three months of the marketing year as BrazilΆs new crop becomes available, rebounded after BrazilΆs and AustraliaΆs exportable supplies dwindle, and fallen off in the last quarter as new Australian cotton becomes available.
Meanwhile, unfixed on-call holdings in December fell 5,956 lots to 8,067 on the mill side and edged up 87 lots to 8,243 on the producer side during the week ended Oct. 25, according to delayed data reported by the Commodity Futures Trading Commission. First notice day for December is Nov. 22.
Futures open interest edged up 58 lots Wednesday to 196,008, with DecemberΆs down 2,895 lots to 86,215 and MarchΆs up 2,334 lots to 80,564.
Certificated stocks grew 3,750 bales to 175,750. Cotton awaiting review increased to 43,710 bales.
World prices as measured by the Cotlook A Index gained 105 points Thursday morning to 85.30 cents. The premium to WednesdayΆs December futures settlement narrowed eight points to 8.23 cents.
