Market took big export sales cancellations in stride and closed with strong gains in front of the USDA planted acreage report. Acreage estimates averaged 12.68 million and 12.618 million in two separate surveys of analysts.
Cotton futures took big U.S. export sale cancellations in stride Thursday, initially sinking and then rallying to finish with strong gains.
Benchmark December completed an outside-range reversal to the upside, closing up 155 points to 69.51 cents to finish above the prior-session high after falling below the previous three weekly lows.
December settled in the upper quarter of the dayΆs 292-point range from down 80 points at 67.16 cents to up 212 points at 70.08 cents. March gained 148 points to close at 70.70 cents.
Volume increased to an estimated 16,900 lots from 13,663 lots the previous session when spreads totaled 3,696 lots or 27% and EFP two lots. Options volume totaled about 5,800 calls and 6,800 puts.
Traders jockeyed for position ahead of the USDA report on Friday on U.S. planted acres and intended plantings as of June 1. The report will update the March intentions of 13.155 million acres, down 1.58 million from last yearΆs plantings, but then there will be new questions on how many acres might be left for harvest.
Estimates by analysts averaged 12.68 million acres within a range from 12.2 million to 13 million in a Dow Jones survey, while a Bloomberg survey produced an average of 12.618 million acres within a range from 11.92 million to 13 million.
Net U.S. all-cotton 2011-12 export sales cancellations of 599,300 running bales during the week ended June 21 reduced commitments for this season to 12.486 million. China cancelled a net 603,700 bales of upland.
Commitments were about 11% above the latest USDA export forecast. In statistical 480-pound bales, commitments totaled about 1.26 million above the projection.
All-cotton shipments of 197,600 running bales lifted exports for the season to 10.170 million, about 90% of the estimate. A year ago, shipments were about 94% of final exports. Shipments now need to average roughly 216,300 running bales a week to achieve the forecast.
Net new-crop sales of 87,900 running bales brought 2012-13 commitments to 2.45 million, about 21% of the forecast. Forward sales a year ago stood at a record high 50% of the current 2011-12 estimate.
Open interest fell 1,368 lots Wednesday to 165,403, with JulyΆs down 82 lots to 1,059, DecemberΆs down 1,809 lots to 132,011 and MarchΆs up 635 lots to 20,268. Certificated stocks grew 1,097 bales to 123,990. There were 5,685 bales awaiting review.
World current-crop values as measured by the Cotlook A Index dropped 20 points Thursday morning to 80.30 cents and new-crop values in the Forward A Index fell 35 points to 79.25 cents.
The current-crop premium to WednesdayΆs July futures close widened 10 points to 12.29 cents, while the new-crop premium to the December settlement narrowed 11 points to 11.29 cents.
