Keith Brown DTN Contributing Cotton Analyst
The cotton market was sharply lower Tuesday as end-of-the-month squaring and growing recession fears caused traders to step aside. The majority of markets from corn to crude to copper were demonstrably lower.
Crude oil was sharply lower on fears that an inflation-induced weakening of global economies. Prices felt more pressure when Russia's fastest-growing oil producer, Gazprom Neft, said it plans to double oil production. Investors will be watching the meeting of OPEC on Sept. 5.
This Friday the Labor Department will issue its monthly jobs reports. A strong number will encourage the Fed to keep raising rates, while a weaker number may slow the pace of higher rates.
The U.S. dollar hit a 20-year high early in the day. The greenback is pricing in huge interest rate hikes at the Federal Reserve's September meeting. Some traders were thinking the Fed would have a more moderate pace until the Jackson Hole conference. Chairman Jerome Powell said the central bank would raise rates and keep them high for some time.
Wet conditions continue to hound the Delta and the Southeast. Over the next 10 days, chances for more rain across the South is above normal. Such conditions can adversely affect the opening crop.
For Tuesday, December closed at 112.32 cents, down 4.84 cents, March 2023 finished at 109.27 cents, down 4.40 cents and July 2023 settled at 101.36 cents, 3.73 cents lower; estimated volume was 27,621 contracts.
Keith Brown can be reached at email@example.com
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