Keith Brown DTN Contributing Cotton Analyst    

Traders completely ignored Thursday's decent export sales to focus on the "what ifs" of having continued strong greenback. Besides the current hawkish "Fed speak" from certain central bankers, the U.S. dollar strengthened Thursday after unemployment claims pointed to a strong jobs market. Such economic nuances suggest the Federal Reserve will keep interest rates higher for longer. To that end, the yield on two-year Treasury notes spiked to levels last seen in July 2007 at 4.918%.    

There were some growers selling on the higher market as well. For whatever reason, it is suspected that a large amount of unpriced production is still in the grower's ownership. It is often said that, until cotton moves from the hands of growers to merchants, it will be difficult for old crop prices to bullishly perform.    

According to a recent update for Cotton Outlook, the British-based analytical group, world production for 2023-24 may near 25.398 million tons or some 2% higher than the 2022-23 season. Additionally, world consumption estimates were revised down by 3.6%, to 24.553 million tons for the new crop season. Also, the group indicated that Brazil's cotton production is estimated at 2.8 million tons for the 2023-24 season, 3.4% lower, due to adverse weather.    

Thursday, May 2023 finished at 83.71 cents, down 1.95 cents, July settled at 84.41 cents, down 1.60 cents and December 2023, ended at 83.75 cents, lower 1.52 cents; estimated volume was 38,619 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

(c) Copyright 2023 DTN, LLC. All rights reserved.