U.S. all-cotton shipments neared USDAΆs estimate for 2015-16. All U.S. cotton entering China now must be fumigated for the Zika virus. Upland growers booked about 4% of their acres.
Cotton futures finished sharply lower Wednesday, with benchmark December extending the prior dayΆs limit loss to settle at its lowest close since July 12.
December closed down 161 points to 71.44 cents, in the lower quarter of its 190-point range from down 205 points at 71 cents to down 15 points at 72.90 cents. It settled below lows of the previous three weekly lows and below a key support point at 71.54.
Nearby October lost 190 points to settle at 71.16 cents, March shed 155 points to 71.99 cents and December 2017 dropped 65 points to 71.15 cents.
Volume increased to an estimated 32,977 lots from 27,177 lots the previous session when spreads accounted for 6,213 lots or 23%, EFP 147 lots and EFS 77 lots. Options volume totaled 5,925 calls and 6,377 puts.
U.S. export sales and shipments scheduled for release Thursday for the week ended Aug. 4, the first weekly report of the new marketing year, will be for a period in which prices advanced 279 points, basis December.
The last report for the week ended July 28 indicated that only about 79,000 all-cotton running bales remained to be shipped in three days to achieve the USDA estimate for 2015-16. Unshipped old-crop sales as of July 31 will be rolled forward to swell 2016-17 commitments.
Upland shipments the last four weeks have averaged 185,700 RB and upland sales for 2016-17 have averaged 171,500 RB.
Meanwhile, all U.S. cotton entering China now must be fumigated for the Zika virus, the American Cotton Shippers Association has learned.
Several Latin American countries were required earlier this year to fumigate their cotton entering China and seven other countries, including the United States, were added last week.
Fumigation requirements are reported to target mainly containers of goods. Shippers can obtain an official quarantine certificate at the origin or China will apply fumigation at a local port.
The time and costs of fumigation are reported to depend on each local port. Normally, it takes at least one working day.
On the crop scene, U.S. upland growers had booked about 4% of their expected acreage coming into August, up from 2% a year earlier, according to informal surveys by USDAΆs Agricultural Marketing Service.
Contracting has been most active in the Mid-South where about 10% of the crop was under contract, up from 3% a year ago. Growers had contracted 8% in the Southeast, up from 4% in 2015; 5% in the West, up from 1%; and less than 1% in the Southwest, against 1%.
These estimates, based on the National Agricultural Statistics ServiceΆs acreage-for-harvest report, donΆt include cotton consigned to marketing organizations but do include cotton contracted with them.
Futures open interest, which had climbed to an eight-year high, fell 3,344 lots Tuesday to 244,954, with DecemberΆs down 3,191 lots to 182,722 and MarchΆs down 284 lots to 41,133. Certified stocks were unchanged at 97,629 bales.
