U.S. export sales expectations may have countered negative vibes from U.S. and global stock markets. Record stocks in the world outside China viewed as a cushion against an eventual rise in Chinese import demand.

Cotton futures churned within extremely small ranges and settled on slight gains Wednesday, with December and March regaining most of what they lost the previous session.

December settled up 21 points to 68.81 cents, near the high of its 32-point range from down a point at 68.59 to up 31 points at 68.91 cents. March closed up 19 points to 68.84 cents, near the top of a mere 28-point range from 68.62 cents — matching Tuesday’s low — to 68.90 cents.

Volume slowed to an estimated 38,655 lots from 46,168 lots the prior session when spreads accounted for 29,877 lots or 65%, EFP 1,665 lots and EFS 170 lots. Options volume fell to 806 lots (512 calls and 294 puts) from 4,545 lots (2,670 calls and 1,875 puts).

Expectations for another round of supportive U.S. weekly export sales may have countered negative vibes from broad losses in U.S. and global stock markets. The USDA is scheduled to release its export sales-shipments report for the week ended Nov. 9 at 7:30 a.m. CST on Thursday.

Prices finished with a 79-point loss for that reporting week, basis December futures, and traded within a 147-point range from 68.01 to 69.48 cents. U.S. prices remained in a tightly competitive position.

Upland sales for shipment this season slowed to 205,300 running bales during the prior reporting week, still well above the pace needed to match the USDA export estimate and have averaged 239,300 RB the last four weeks.

Shipments of upland rose to a six-week high to 124,300 RB, still well below the pace needed to achieve the export forecast, and have posted a slow four-week average of 98,000 RB. The export tempo has been expected to quicken as more cotton enters depleted market pipelines.

Meanwhile, by reaching a new record for ending stocks outside China this crop year, the rest of the world is building a cushion against an eventual rise in Chinese imports, says Cotton Inc.

The USDA trimmed its forecast for world stocks outside China by 1.7 million bales this month to 51.21 million, still exceeding by 15% the previous record of 44.2 million bales set in 2014-15.

A key question for prices concerns the tempo of the expected rise in Chinese imports. If China feathers increases over several crop years, gradually lifting imports from the current level near 5 million bales to near the current production deficit of 14 million bales, acreage outside China would have time to respond to higher demand, CI says.

But a sudden shift from current import levels to two to three times higher — from 5 million to 14 million bales — would be expected to provoke a more dramatic price reaction.

Heavy global stocks of corn and soybeans could counter the effects of rising Chinese import demand on cotton prices. Because those crops can compete for cotton acreage, low corn and soybean prices resulting from high stocks could make it easier for cotton to maintain or increase acreage and production.

“This support for cotton production will help offset the effects of an eventual increase in Chinese import demand,” CI says.

China ranks as the largest export buyer of U.S. cotton for shipment this season on purchases of 1.867 million bales, 20% of total 2017-18 commitments thus far.

Futures open interest fell 2,191 lots to 226,636 on Tuesday, with December’s down 8,496 lots to 34,846 March’s up 5,325 lots to 134,922. Certified stocks were unchanged at 48,128 bales.