Cotton Closes Choppy Session Narrowly Mixed

Traders looked ahead to the U.S. weekly export sales-shipments report on Thursday and monthly supply-demand estimates on Friday. Growers had contracted 3% of their expected upland crop as of Oct. 1.

Cotton futures finished a session of choppy price action narrowly mixed Wednesday, with benchmark December — the only loser — settling with a fractional loss after posting a new high for the move.

December settled off three ticks at 62.05 cents, just below the midpoint of its 70-point range from up 40 points at 62.48 to down 30 points at 61.78 cents. It retreated, holding slightly above the prior-session low, after hitting a 61.8% retracement of the decline from the Sept. 11 high of 64.20 to the Sept. 24 contract low at 59.70.

A late rally brought December to a near-flat settlement and a last tick at 62.40 cents. March finished up 10 points to 61.95 cents.

Maturing October settled up 80 points to 61.94 cents, an 11-point discount to December. Thursday is the last trading day for the October contract, but only seven lots remained open coming into WednesdayΆs session and seven lots were reported to have traded on the spread.

Volume increased to an estimated 18,500 lots from 16,670 lots the previous session when spreads accounted for 4,659 lots or 28%, EFS 43 lots and EFP 25 lots. Options volume totaled 3,309 calls and 4,758 puts.

Traders looked ahead to the U.S. weekly export sales-shipments report on Thursday and the monthly supply-demand estimates on Friday.

Some estimates for U.S. upland export sales range from 75,000 to 150,000 running bales for the week ended Oct. 1. The USDA is scheduled to release the report at 7:30 a.m. CDT.

Net upland sales the previous four weeks have averaged 97,012 bales, including 117,300 bales for the week ended Sept. 24. Shipments have averaged 94,063 bales, with prior-week exports having fallen to 70,452 bales, second lowest of the crop year.

Prices during the week ended last Thursday ranged between 59.90 and 61.57 cents, basis December, and on a closing basis spanned a narrow 56-point range between 60.44 and 61 cents.

The USDA last month raised its export estimate slightly as a result of the larger U.S. crop and expected competitiveness this season, hiking the forecast 200,000 bales to 10.2 million statistical 480-pound bales.

The September estimate — about 9.89 million running bales — still is for the lowest exports this season since 2000-01. U.S. exports are projected to account for about 30% of world cotton trade, a share that is between that of 2013-14 and 2014-15.

Meanwhile, U.S. upland growers had contracted about 3% of their expected crop as of Oct. 1, down from 9% a year ago and at least a 10-year low, USDA has reported.

The contracting estimates are based on informal surveys by the Agricultural Marketing Service and the September acres-for-harvest forecasts of the National Agricultural Statistics Service.

Growers have booked about 6% of their upland acres in the Southeast and Mid-South, down from 22% and 9%, respectively, a year ago. Contracting totaled only 1% in the Southwest, down from 5%, and rose to 6% in the West from 2%.

Those estimates donΆt include cotton consigned to marketing organizations but do include cotton contracted with them.

Contracting coming into October over the last 10 years has ranged from 4% in 2007, 2009 and 2010 to 37% in 2011. Bookings totaled 16% in 2013, 14% in 2012, 10% in 2008 and 6% in 2006.

Futures open interest dropped 242 lots Tuesday to 189,761, with DecemberΆs down 804 lots to 122,160 and MarchΆs down 112 lots to 48,601. Cert stocks increased 38 bales to 44,364.