DTN Cotton Close: Lower in Bearish Mood Swing
DTN Cotton Close: Lower in Bearish Mood Swing

DTN Cotton Close: Lower in Bearish Mood Swing

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By Keith Brown, DTN Contributing Cotton Analyst 

The cotton market was lower to sharply lower Thursday in a bearish post-report mood swing. Earlier, USDA issued its weekly export sales report, which we described in the morning comments as uninspiring. Then at 11 a.m. CDT, USDA presented its planting intentions for 2022. They were deemed unfriendly, as the number was 12.20 million acres versus last year’s 12.10 million, a 9% increase.

Looking ahead, USDA will issue its Friday, April 8. It is thought with the huge winter surge in export sales that tabulators would see the need to increase the exports category, and thus lower carryout as well. Additionally, it is thought that global stocks would see yet another decline. Naturally, that remains to be seen.

With new-crop production comes concerns of abandonment. Currently, Texas and certain surrounding states are in the grip of a deep drought. If that dry pattern remains intact, then traders would expect lower-than-normal yields from the nation’s largest producing state hugely reduced. Additionally, another cause of higher abandonment may be the exorbitant costs of crop inputs.

Friday at 7:30 a.m. CDT, the Labor Department will release its monthly jobs data. Expectations call for non-farm jobs to be 490,000 compared to last month’s 678,000 jobs. Oddly, too strong of a number will encourage the Federal Reserve to hike interest rates one-half percent higher next month.

Heading into Friday’s trade, May cotton is down 21 points on the week, but up 1,657 points for the month, and also up 2,550 points on the year.

Thursday, May cotton settled at 135.69 cents, down 4.15 cents; July closed at 132.07 cents, minus 4.13 cents; and December finished at 111.28 cents, 1.16 cents higher. Thursday’s estimated volume was 38,211 contracts.

Πηγή: Agfax



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