U.S. all-cotton planting intentions reported up 11.4% from last year to 9.562 million acres. The largest percentage upland increase is foreseen in the Mid-South, up 45.7%.
Cotton futures rallied from a seven-session low to finish an outside-range reversal to the upside Thursday, shrugging off U.S. prospective plantings on the upper side of most pre-report estimates.
Spot May led the advance, settling up 77 points to 58.44 cents, near the high of its 158-point range from down 66 points at 57.01 to up 92 points at 58.59 cents. It finished above highs of the prior four sessions and inverted back over July. May gained 194 points or 3.4% for the month.
July finished up 59 points to 58.31 cents and December rose 32 points to settle at 57.77 cents. The new-crop contract closed back above its nine-day moving average.
Fresh weakness in the U.S. dollar index offered support following the previous sessionΆs new five-month low. Talk resurfaced of tight availability of higher quality cotton.
Volume quickened to an estimated 37,840 lots from 27,864 lots the previous session when spreads accounted for 18,807 lots or 68% and EFP 22 lots. Options volume totaled 6,523 calls and 2,712 puts.
U.S. all-cotton prospective plantings of 9.562 million acres, up 11.4% from 8.581 million acres last year, USDA reported, compared with predominant expectations centering mostly around 9.4 million acres.
Upland area is estimated at 9.347 million acres, up 11% from 8.422 million in 2015, and Pima plantings are forecast at 215,000 acres, up 35.6% from 159,000 acres.
Despite the expected increase, the total planted acreage, if realized, would be the seventh lowest on record, USDA said. The 2015 acreage was the lowest since the payment-in-kind farm program of 1983.
Growers in all states except North Carolina, South Carolina and Virginia are expected to increase their cotton acreage. If realized, the upland planted area in California would be a record low.
The largest percentage upland increase is foreseen in the Mid-South, up 45.7% to 1.435 million acres. Producers intend to cut their upland acres by 5.1% to 2.12 million acres in the Southeast, while increases of 11.2% to 5.592 million acres are foreseen in the Southwest and 17% to 200,000 acres in the West.
Growers in Texas, the largest cotton-producing state, intend to plant 5.3 million acres of upland, up 10.4% from 4.8 million acres last year, and 22,000 acres of Pima, up 29.4% from 17,000 acres. This would be the second smallest all-cotton acreage in the Lone Star State since 2009.
A USDA statistical table showed changes between the U.S. upland intentions and final plantings have averaged 620,000 acres over the last 20 years, ranging from 6,000 acres to 2.115 million acres. The intentions have been below final plantings 11 times and above nine times.
Futures open interest grew 1,844 lots Wednesday to 218,354, with MayΆs down 1,896 lots to 109,277 and JulyΆs up 3,762 lots to 55,317. Cert stocks were unchanged at 47,037 bales.
