All-cotton export commitments reached 72% of the USDA forecast and shipments 38%. Mills priced 4,034 on-call lots in March last week to cut their unfixed position to 4,872 lots prior to first notice day.
Cotton futures chopped on both sides of unchanged and settled mostly marginally lower for the day and higher for the week Friday, with most-active May finishing three ticks below where it opened overnight.
- May closed down 16 points to 59.54 cents, in the lower third of its narrow 62-point range from up 27 points at 59.97 to down 35 points at 59.35 cents. It touched the high prior to the U.S. weekly export sales report and the low almost 2-1/2 hours after USDA released the data.
- March, with only one trading session now left before first notice day, finished up 10 points to 60.01 cents, the only gainer. July dipped 13 points to 59.68 cents and December slipped 16 points to 59.56 cents.
- For the week, the market gained 111 points in March, 90 points in May, 61 points in July and 63 points in December.
- Volume slowed to an estimated 26,713 lots from 37,038 lots the previous session when spreads accounted for 21,244 lots or 57%, block trades 2,705 lots and EFP 84 lots. Options volume totaled 4,643 calls and 990 puts.
Net U.S. all-cotton export sales for shipment this season of 318,900 running bales, a marketing year high and up from 240,800 RB the previous week, brought 2015-16 commitments to 6.65 million RB.
The gap behind year-ago commitments — cancellations exceeded gross sales during the corresponding week last season — narrowed 380,000 RB to 2.948 million RB or to 31%. Commitments were 72% of the USDA export forecast, compared with 88% of final shipments a year ago.
All-cotton shipments slowed to 190,200 RB from 195,500 RB the week before, bringing exports for the season to 3.462 million RB. The lag behind year-ago shipments widened 116,000 RB to 698,000 RB or to 17%.
Concerns about the quality makeup of the U.S. crop and the acquisition of needed qualities may have contributed to the slower shipments. However, shipments at 38% of the USDA forecast were about the same as the percentage of final 2014-15 exports a year ago.
To achieve the USDA forecast, shipments need to average roughly 239,700 RB a week, while sales averaging around 106,900 RB weekly would match the export projection.
Sales for delivery next season of 12,100 RB, down from 53,700 the prior week, nudged 2016-17 commitments to 900,700 RB, up 250,500 RB from forward bookings a year ago.
Meanwhile, unpriced on-call positions in March declined by 4,034 lots to 4,872 on the mill side and by 2,050 lots to 3,593 on the producer side last week, according to Commodity Futures Trading Commission data.
Five trading sessions then remained prior to first notice day for March. The net call difference dropped 1,984 lots to 1,279, which was 2.85% of the declining March open interest.
Unfixed mill positions outweighed the unpriced producer positions by a ratio of 1.36:1. Mills also priced 2,093 lots in May to cut their unfixed position there to 12,903, while producers added 1,764 lots to boost theirs to 2,812.
Futures open interest fell 2,573 lots Thursday to 189,248, with March’s down 6,928 lots to 8,349 and MayΆs up 3,931 lots to 113,948. Cert stocks grew 805 bales to 60,463, up from 32,629 bales a week ago. There were 807 newly certified bales and two bales decertified.
