Keith Brown DTN Contributing Cotton Analyst    

The fiber market fell to limit-down Wednesday as all the talk of recession into next year is taking its toll. For the longest time Wednesday, cotton held the psychologically 80-cent mark, but once that was breached, it was a quick hop, jump and a skip to limit down. Other contract months were sharply lower, but only spot December was that drastic of a close.    

In addition, cotton prices were also pressured under the weight of the 2022 harvest. On Monday, USDA reported that 37% of the current crop was gathered versus 29% a week ago. Also, China's COVID lockdowns continue to worry traders regarding overall demand. Accordingly, China has delayed issuing its latest GDP numbers for fear they will reflect just how economically devastating the lockdowns were.    

Thursday morning, USDA will issue its weekly export sales. Last week's combined seasonal sales of 179,600 bales, with Pakistan as the top buyer. Weekly shipments were 168,000 with China as the lead importer.    

The U.S. dollar was higher Wednesday, yields on U.S. treasury yields rose to 14-year highs. Additionally, the UK saw a hotter-than-expected consumer price inflation, which sent the pound lower, as well as deepening the fears of recession. The greenback hit a 32-year high against the Japanese Yen, approaching the 150-level, where some traders suspect the Bank of Japan might intervene in the tumbling currency.    

For Wednesday, December closed at 78.29 cents, down 4.00 cents, March 2023 finished at 77.97 cents, 3.47 cents down, and July 2023 settled at 76.42 cents, 3.02 cents lower; estimated volume was 47,753 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

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