U.S. cotton exports expected to reach 15 million bales this season, says NCC, up 500,000 bales from USDA’s latest estimate. Exports next season projected to slow to 14.3 million bales.

Cotton futures finished mixed Tuesday, fractionally lower in old-crop deliveries and modestly higher in new-crop contracts.

March climbed off a new low since Dec. 21 to settle still down seven ticks at 76.38 cents, near the high of its 84-point range from up five points at 76.50 in the overnight session to down 79 points at 75.66 cents. It has posted new lows for the move five times in the last seven sessions.

May closed down five points at 77.40 cents, trading within an 88-point range from 77.54 to 76.66 cents, and July settled down two points at 78.42 cents, trading within an 84-point span from 78.50 to 77.66 cents. December edged up 13 points to 75.87 cents, a couple of points off the high of its 77-point range.

Heavily oversold daily momentum readings and lower U.S. dollar index futures may have helped the market to rally off the lows.

Volume slowed to an estimated 66,300 lots from 78,092 lots the prior session when spreads accounted for 55,009 lots or 70%, EFS 3059 lots and EFP 65 lots. Options volume rose to 8,847 lots (4,670 calls and 4,177 puts) from 3,541 lots (1,582 calls and 1,959 puts).

U.S. cotton exports are expected to reach 15 million bales this season, up 500,000 bales from USDA’s February forecast, the National Cotton Council said in its economic outlook at the annual industrywide meeting over the weekend in Fort Worth.

The USDA surprised cotton analysts with a 300,000-bale reduction in its export forecast last week, citing lagging shipments thus far and expectations for the second half of the marketing year.

Jody Campiche, the NCC’s vice president for economics and policy analysis, noted in the outlook report that sales have surpassed those of recent crop years. Heavily discounted low micronaire cotton appears to have boosted sales, she said.

The council’s export projection is up from last season’s 14.92 million bales, the second highest on record behind only 17.67 million bales in 2005-06.

Noting that the shipment pace has increased the past few weeks, Campiche said it will need to remain strong the remainder of the marketing year to reach the council’s estimate.

As of Feb. 1, sales had reached 13 million bales, she observed, but only 5.2 million bales had been shipped, the second lowest shipment percentage in the last decade at this point in the marketing year.

Several factors led to shipping delays earlier this season, she said, adding that trucking shortages along with increased trucking costs currently are the main issue impacting cotton shipments.

The shipments pace during the second half of the crop year generally is higher as harvesting and ginning are completed. The USDA expects a slower sales pace during the remainder of the marketing year owing partly to increased competition from an early harvest in Australia and lower exports to Mexico on increased production.

Looking ahead, the council expects increased competition from other cotton-producing countries to reduce both U.S. exports and market share in 2018-19. With exports pegged at 14.3 million bales, Campiche projected total U.S. offtake of 17.7 million bales, leading to an increase in ending stocks of 1.5 million bales.

Futures open interest decline 4,732 lots on Monday, with March’s down 13,025 lots to 38,711 and May’s up 5,058 lots to 112,084. Certified stocks increased 6,168 bales to 85,121. The addition was at Galveston.