Cotton futures were generally steady during the week, trading daily with only double digit gains or losses. Both the nearby July and December ICE New York contracts settled almost ten points higher on the week. With the first week in some time with limited price volatility, options volatility shrunk down to near only 2 percent. The market worked its tightest ranges in about a month and suggests that prices are setting up and attempt to break either higher or lower.

The 82-84 cent support came into play again this week with the 84 cent level holding firm. The road to nowhere will likely be the primary price route during the coming month as the aforementioned support holds and the 88-89 cent resistant keeps a lid on any attempt to rise higher.

The Southeast and Midsouth made excellent planting progress with a generally open weather week. Sure, plantings are later that what research says is ideal. Yet, record yields have been scored on late planted cotton in numerous years in both regions. The market will not likely express any concern about planting progress in either of those regions.

However, the Southwest and Texas Plains are another story given that is the location of most of the U.S. plantings. Unfortunately, that region remains caught in a widespread long term drought that has easily fought off the very few meager attempts to break it. Granted there were some showers the prior weekend, but only a very few local showers were noted. Too, given the near total lack of subsoil moisture, three to five good covering showers would be needed to allow for the potential of a normal crop—and the dry season is set to begin in less than a month. As the historical statement that the Rio Grande Valley requires rain by Cinco de Mayo, the High Plains has to have decent moisture by Memorial Day, or the first of June. Not only is the Southwest dry, it is now facing 100 degree temperatures that will only spell a quicker doom.

Export sales were a bit slower on the week, but again several of the reporting days faced ICE futures prices above 86-87 cents. Nevertheless, sales were better than had been expected. Export sales have now reached 99 percent of the USDA export projection of 13.25 million bales…and that is with eleven more reporting weeks remaining in the marketing year.

The trading range will continue, but as the market moves toward mid-June, there will likely be another challenge of the 89 cent level in December. …playing my old record again… “If you like the price enough to plant it, then like the price enough to sell some.”