By Keith Brown DTN Cotton Correspondent
The cotton market was lower Monday on USDA crop report data. Essentially, the government raised the 2019 crop some 500,000 bales to 22.520 million bales. However, in a surprise move, USDA also increased exports 200,000 bales to 17.20 million bales. The pre-report consensus was a 500,000-bale slash in exports due to U.S.-China trade frictions.
In the world numbers, USDA left the major producing countries unchanged in their respective production from one month ago. Still, global stocks increased 2 million bales to 82.45 million. Most of that rise came from the increase in the U.S. crop, as well as a higher carryover from the 2018-19 season. Surprisingly, the cotton market finished moderately lower.
Monday afternoon USDA will issue its latest crop rating information. For several weeks, the government has pegged the 2019 crop at 60% good to excellent. However, just last week, Texas saw a 13-point decline, and since that time conditions for much of the Cotton belt has been unduly hot and dry.
Internationally, the market will monitor the situation in Hong Kong. The protesters, estimated to be one million strong, have taken over the airport. There are fears China will ultimately come down hard militarily, which could upend the global economy.
Monday, December cotton settled 58.14 cents, down 0.76 cent, March was 58.90 cents, down 0.96 cent and December 2020 finished at 62.62 cents, off 0.63 cent. Today’s estimated value was 23,800 contracts.