Traders looked forward to delayed export sales report. Importance of exports to U.S. agriculture highlighted by farm and commodity groups. Nomination of Perdue as secretary of agriculture welcomed.
Cotton futures finished ahead for a second day Thursday, trading within the overnight range and settling above the prior-session high.
Spot March closed up 43 points to 72.69 cents, just below the midpoint of its 102-point range from up a point at 72.27 to up 103 points at 73.29 cents. It didnΆt seriously challenge either end of the overnight range during the day.
May gained 51 points to settle at 73.26 cents, while December edged up 15 points to close at 71.13 cents.
Volume increased to an estimated 23,128 lots from 20,368 lots the previous session when spreads accounted for 9,247 lots or 45%, EFP 199 lots and EFS 184 lots. Options volume totaled 3,490 calls and 2,188 puts.
Traders looked forward to the delayed U.S. weekly export sales report scheduled for release by USDA at 7:30 a.m. CST Friday.
At least a modicum slowdown appears generally expected from net upland sales of 236,000 running bales during the prior week ended Jan. 5, but the sales performance lately has a history of beating expectations.
The importance of strong exports, open export markets and positive trade promotion and agreements has been highlighted in a letter sent by the National Cotton Council and 15 other farm and commodity organizations to President-elect Trump and Vice President-elect Pence.
“This includes enforcing existing agreements so that other countries abide by their commitments, as well as expanding market access for U.S. producers through new agreements,” the latter said.
“The importance of trade to AmericaΆs farmers and ranchers cannot be overstated. The share of U.S. agricultural production exported overseas is 20% by volume, with some sectors being much higher.”
For example, the groups said, exports account for more than 70% of the U.S. production of tree nuts and cotton, more than 60% of soybeans and more than 50% of rice and wheat.
The letter pointed out that China, Canada and Mexico represent U.S. agricultureΆs top three export markets, emphasizing that:
“Disrupting U.S. agricultural exports to these nations would have devastating consequences for our farmers and the many American processing and transportation industries and workers supported by these exports.”
Meanwhile, agricultural groups welcomed the nomination of former Gov. Sonny Perdue as secretary of agriculture.
The NCC congratulated Perdue on his nomination and said the cotton industry looks forward to working with him “to help ensure a strong and viable agricultural and rural economy, including important actions necessary for the stabilization of the U.S. cotton industry.”
Council Chairman Shane Stevens added in a statement, “It is encouraging to see a secretary of agriculture nominee with a strong production agriculture and agribusiness background and with experience who comes from the second largest cotton-producing state.”
The council is the U.S. cotton industryΆs central organization representing producers, ginners, cottonseed processors and merchandizers, cotton merchants, cooperatives, warehouses and textile manufacturers.
Futures open interest declined 1,136 lots Wednesday to 260,620, with MarchΆs down 2,033 lots to 164,625 and MayΆs up 547 lots to 43,575. Certified stocks grew 2,174 bales to 114,730.
