Cotton Finishes Mixed as December Rallies
December rallied to close slightly ahead. U.S. export commitments reached 32% of the USDA forecast for 2015-16 and shipments 9%. Hurricane Joaquin could bring heavy rain to some cotton areas of the Southeast.
Cotton futures closed mixed Thursday as benchmark December rallied from an early dip to finish modestly higher on inside-range trading amid uncertainty over the path of Hurricane Joaquin.
December settled up 16 points to 60.60 cents, in the upper half of its 116-point range from down 54 points at 59.90 to up 62 points at 61.06 cents. March closed off two points to 60.29 cents, while the other traded contracts settled off a point to up four points.
Volume slipped to an estimated 20,700 lots from 23,378 lots the previous session when spreads accounted for 5,631 lots or 24% and EFP 333 lots. Options volume totaled 2,891 calls and 1,552 puts.
Open interest expanded 2,592 lots Wednesday to 188,615, with DecemberΆs up 1,006 lots to 122,924 and MarchΆs up 1,057 lots to 48,536. Cert stocks declined 174 bales to 44,845.
Net U.S. all-cotton export sales for shipment this season of 121,900 running bales during the week ended Sept. 24, up from 100,600 the previous week, brought 2015-16 commitments to 3.2 million RB, according to the latest USDA data.
The gap behind commitments a year ago widened by 107,000 RB to 2.346 million RB, which was 32% of the USDA export forecast, compared with 51% of final shipments at the corresponding point last season.
All-cotton shipments slowed to 76,700 RB from 114,500 RB the previous week, but the lead of cumulative exports over the year-ago total narrowed by only 2,700 RB to 122,200 RB.
Exports for the season reached 901,200 RB, up from 799,000 RB a year ago, and were 9% of the USDA projection, against 7% of final 2014-15 shipments as of Sept. 25 last year.
To achieve the USDA forecast, shipments need to average roughly 199,800 RB per week, while sales averaging around 148,800 RB would match the export projection.
Upland sales for shipment next season of 800 RB, down from 5,000 RB the week before, hiked 2016-17 commitments to 210,800 RB, widening the lag behind forward bookings a year ago by 700 RB to 207,400 RB.
Meanwhile, forecasters expected Joaquin to near the East Coast along North Carolina and Virginia on Sunday or Monday, bringing the potential for heavy rains and flooding to cotton areas of the Southeast.
Open bolls as of last Sunday totaled 83% in North Carolina, 80% in Virginia and 84% in South Carolina. In Georgia, the nationΆs No. 2 cotton state, the crop was 86% open and 6% had been harvested.
Rain on open cotton can adversely affect quality, though the effects can be minimized when followed shortly with sunshine and good drying conditions, and also can hurt yields, especially over time.
The heaviest rains from Joaquin, now upgraded to a Category 4 storm, were expected to range from northern Georgia to Virginia, with up to around 7 inches not ruled out for parts of the Carolinas.
