Showers and thunderstorms forecast for the Texas High and Rolling Plains. BrazilΆs cotton output forecast at 7.35 million bales.
Cotton futures settled narrowly mixed and little changed in the front two deliveries Thursday and up a modest 14 to 20 points in the other traded contracts through December 2014.
Spot December closed off three ticks at 83.17 cents, just off the low of its 113-point range from up 106 points to 84.26 cents to down seven points at 83.13 cents.
December touched the high around 6:20 a.m. CDT, climbing above the prior-day high, and the low about 1:10 p.m., holding three points above WednesdayΆs lowest intraday print since Sept. 10.
March eked out a three-point gain to close at 84.01 cents, two ticks off the low of its 94-point range from 84.92 cents to 83.99 cents, while December 2014 gained the most, closing at 79.31 cents.
Fresh overnight physical business — inquiries were reported from China — and mill fixations offered support amid oversold technical readings before the nearby rally ran out of steam shy of TuesdayΆs highs.
Volume slowed to an estimated 15,000 lots from 22,831 lots the previous session when spreads accounted for 10,222 lots or 45% and EFP for 48 lots. Options volume totaled 4,206 calls and 3,264 puts.
A 20% chance for showers and thunderstorms is forecast tonight and Saturday night for the main Texas High Plains cotton area around Lubbock, improving to 30% on Sunday. A slight chance will linger into Monday.
Mostly light amounts are expected, ranging from a few hundredths of an inch to around half an inch with localized totals to around an inch. A period of dry weather under partly to mostly sunny skies then is expected to minimize any effects on lint quality or field operations.
Heavier rains are possible this weekend in much of the adjoining Rolling Plains on the east and the Edwards Plateau, forecasters say. ThereΆs a potential for widespread amounts of 2 to 3 inches and higher beginning Saturday night and continuing into Monday.
The USDA last month estimated the crop at 2.5 million bales in the High Plains and 855,000 bales in the Rolling Plains for a combined 3.355 million bales, against 3.479 million last season. The combined output would be 82% of the Texas crop and 27% of the U.S. upland production.
On the international scene, BrazilΆs official 2013-14 cotton production is reported to have risen to 1.6 million metric tons or 7.35 million 480-pound bales from 7.2 million bales projected by USDA last month and a 2012-13 output of 5.8 million bales.
Futures open interest declined 1,622 lots Wednesday to 205,773, with DecemberΆs down 2,282 lots to 126,068 and MarchΆs down 312 lots to 61,535. The board total had jumped from 182,453 lots on Sept. 24 to FridayΆs high of 212,142 lots.
Certificated stocks grew 2,686 bales to 17,386. There were 2,690 newly certified bales, all at Memphis, and four bales decertified. Cotton awaiting review rose to 38,506 bales, including 8,849 bales at Galveston, 11,068 bales at Greenville and 18,589 bales at Memphis.
World values as measured by the Cotlook A Index dropped 30 points Thursday morning to 89.40 cents. The premium to WednesdayΆs December futures settlement widened 19 points to 6.20 cents.
Meanwhile, the exchange announced initial and maintenance margin requirements will be reduced $900 to $1,600 for hedgers, effective Friday, and will be $1,760 and $1,600, respectively, for other traders.
