Tropical Storm Harvey is expected to bring heavy rains to the South Delta after inflicting catastrophic flooding in Southeast Texas. Wind damage from Hurricane Harvey blew tarps off and beat up cotton modules. Producers rushed harvesting ahead of Harvey.
Cotton futures rebounded to triple-digit closing gains in most traded contract months Monday, with December regaining precisely what it had lost the prior session.
December gained 168 points to settle at 69.83 cents, near the high of its 139-point range from up 41 points at 68.56 to up 180 points at 69.95 cents. It matched Thursday’s close as its highest finish since Aug. 9, the day before USDA’s surprise crop and supply-demand reports.
March settled up 127 points to 69.40 cents, trading within a 109-point range from 68.31 to 69.40 cents. October gained the most, settling up 172 points to 70.33 cents.
Concerns about crop quantity and quality losses to winds and flooding in the early harvesting areas of Texas and crop vulnerability to excessive rains in parts of the Delta fueled the rally. Additional weakness in U.S. dollar index futures also offered support.
Volume slipped to an estimated 21,660 lots from 29,082 lots the previous session when spreads accounted for 10,553 lots or 36%. Options volume dropped to 5,308 lots (2,775 calls and 2,533 puts) from 14,388 lots (7,814 calls and 6,574 puts).
Tropical Storm Harvey is expected to bring heavy rains through Wednesday through central Louisiana and southwest Mississippi after inflicting catastrophic flooding in southeast Texas where rains continued.
Wind damage from Hurricane Harvey, which made landfall on Friday and was downgraded into a tropical storm on Saturday, was heaviest just north of Corpus Christi at Rockport and surrounding areas.
Winds blew tarps off and beat up modules of harvested cotton. There were fears that seed in some of the wet modules will begin to sprout. Growers were harvesting a bumper crop of high quality. Agricultural buildings near Rockport were damaged.
The projected path of Harvey indicated heavy rain could expand across a larger area of the Delta Thursday into Saturday, though forecasters said the track remained uncertain and could change.
Producers in South Texas rushed to harvest as much of the cotton remaining on the stalk as possible last week ahead of Harvey.
Local sources reported harvesting was about 90% complete in the Rio Grande Valley and neared 80% completion in the Coastal Bend, USDA’s Agricultural Marketing Service reported Friday in a weekly cotton review.
Exceptional yields of three to four bales per acre were reported. Producers moved modules to higher ground. Approximately 40% to 50% was harvested in the Upper Coast. Ginning expanded there.
Scattered thunderstorms caused concern in the Blackland Prairies where bolls were open. Damage assessments were ongoing. Limited harvesting had begun and some modules were delivered to gin yards. Defoliants were applied in drier fields.
Elsewhere, good crop progress was reported in the South Delta. Many fields had reached cutout and were no longer vulnerable to insect damage. Sources reported that boll rot and boll lock were apparent in fields where excessive rains had fallen in recent weeks. However, boll loads were heavy good yields still anticipated.
Most fields in the North Delta were rapidly approaching the point where no additional inputs will be required until defoliation. Some late-planted fields still were being scouted for bollworms and plant bugs, however, and hotspots were treated as needed.
Futures open interest edged up 130 lots Friday to 226,542, with December’s down 687 lots to 146,142 and March’s up 943 lots to 56,483. Certified stocks declined 180 bales to 10,708.
Source: http://agfax.com/2017/08/28/dtn-cotton-close-rebounds-on-triple-digit-gains/