Keith Brown DTN Contributing Cotton Analyst    

The cotton market was virtually limit-down Wednesday amid poor supply-demand numbers stemming from USDA's October crop update. In addition, Wednesday's PPI data was bullish to the U.S. dollar.    

Domestically, U.S. crop production was cut a mere 200,000 bales, exports were shaved 100,000, thus ending stocks were upped 100,000 to 2.80 million. However, the world numbers were the more bearish aspect of Wednesday's information. That is, foreign consumption, across-the-board declined, with China and India leading the bearish charge. Thus, world carryout spiked some three million bales to 87.87 million.      

Wednesday's PPI report revealed an increase of wholesale prices to 0.4% for September, compared with estimates for a 0.2% gain. Excluding food, energy and trade services, the index rose 0.4% for the month and 5.6% from a year ago. The Federal Reserve also issued the minutes from its last meeting. The bottom line is Fed officials expect higher interest rates to remain in place until inflation abates.    

Thursday, the Commerce Department will issue its closely watched CPI report (consumer prices). This is the report that has wildly knee-jerked the economy and the markets before.    

USDA will issue its weekly export sales on Friday. Last week saw a small sales number of 121,000 bales. Also, the Commerce Department will publish its monthly Retails Sales Report on that day.    

For Wednesday, December closed at 84.92 cents, down 3.94 cents, March 2023 finished at 83.47 cents, down 3.84 cents and July 2023 settled at 80.67 cents, 3.25 cents lower; estimated volume was 38,223 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

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