A boost in the U.S. crop estimate is expected in some quarters in USDAΆs supply-demand report next week. U.S. weekly export sales rose, while the lead of commitments over year-ago bookings narrowed a bit.
Cotton futures settled on modest losses Thursday, with benchmark December trimming a slide below lows of the prior two weeks to finish just above the midpoint of its session range.
December closed down 32 points to 67.50 cents, just below the prior-day low at its lowest settlement since Sept. 16. It traded within a 115-point range from up 18 points at 68 cents to down 97 points at 66.85 cents and finished right where it opened overnight.
March dipped 26 points to settle at 68.10 cents, while December 2017 dropped 38 points to close at 68.54 cents.
Volume slipped to an estimated 20,200 lots from 23,581 lots the previous session when spreads accounted for 8,221 lots or 35% and EFP 52 lots. Options volume totaled 4,294 calls and 2,139 puts.
An increase is expected in some quarters in the U.S. crop estimate in next weekΆs USDA supply-demand report, possibly overshadowing fears about potential cotton damage in the Southeast from Hurricane Matthew.
The USDAΆs National Agricultural Statistics Service isnΆt expected to have had time to have fully evaluated the potential crop impact of Hurricane Matthew for the monthly update. Crop conditions in USDAΆs progress reports have improved by slight margins the last three weeks.
An outside-range down on Wednesday when December closed back below its nine-day, 18-day and 40-day moving averages left a negative technical imprint. December had just finished back above those marks on Tuesday.
U.S. upland production is estimated at 15.735 million bales by Informa Economics, Memphis-based analytical firm, sources said, up 155,000 bales from USDAΆs September forecast.
A steady Pima crop estimate of 562,000 bales then would mean an all-cotton forecast of 16.297 million bales, up from USDAΆs 16.142 million. Some other estimates have ranged up to around 16.5 million bales.
The market shrugged off an increase in U.S. all-cotton export sales for shipment this season to 182,500 running bales during the week ended Sept. 29 from a marketing year low of 113,200 RB the previous week.
All-cotton commitments rose to 5.501 million RB, 49% of the USDA export forecast, compared with 38% of final 2015-16 exports at the corresponding point last season. The lead over year-ago commitments narrowed 27,000 RB to 2.091 million or to 61%.
Shipments of upland and Pima combined rose to 219,600 RB from 160,800, boosting the total for the season to 1.643 million RB and widening the margin ahead of a year ago by 88,000 RB to 611,000 RB. Shipments were 15% of the USDA forecast, compared with 12% of final 2015-16 exports a year ago.
To achieve the USDA projection, shipments need to average roughly 216,200 RB a week, while weekly sales averaging approximately 128,500 RB would match the export forecast.
No fresh sales for shipment next season were reported. This left 2017-18 commitments at 428,000 RB, now 141,200 RB behind forward bookings a year ago.
Futures open interest dropped 421 lots Wednesday to 248,216, with DecemberΆs down 1,329 lots to 156,566 and MarchΆs up 622 lots to 57,036. Cert stocks grew 215 bales to 30,636. There were 270 newly certified bales and 55 bales decertified.
