Keith Brown DTN Contributing Cotton Analyst
The cotton market attempted to make a bullish headway Wednesday amid worsening weather conditions for Texas. The ICE futures posted a new high for the week. In quick summary, the "western oven" seems to be getting hotter as the latest forecasts have upped the temperatures, and Texas growers all but tell us the dryland crop there is a "lost cause."
The energy complex was moderately lower Wednesday after U.S. Government data showed lower gasoline demand during the peak summer driving season. In addition, in one week, the Federal Reserve will announce its latest hike in interest rates. Ultimately, higher rates could slow the economy, and thus could negatively impact energy demand.
The latest weather update now allows for "a bit of rain" in the Texas Panhandle. However, the bulk of the growing area will remain hot-and-dry. The six- to 10-day forecast still calls for much above-normal temperatures, with rainfall chances normal to below normal. The balance of the cotton belt will see normal chances of rainfall. Thursday, USDA will issue its weekly export sales. With the 2021-22 season quickly winding down, sales may be even weaker than recent reports.
For Wednesday, December closed at 92.81 cents, up 0.43 cents, March 2023 finished at 88.90 cents, up 0.25 cent and July 2023 settled at 85.14 cents, 0.32 cent higher; estimated volume was 14,580 contracts.
Keith Brown can be reached at firstname.lastname@example.org
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