U.S. export commitments reached 75% of the USDA forecast and shipments 42%. Competitive price gap narrowed to 2.06 cents.
Cotton futures settled higher Thursday, led by most-active May, which completed an inside-range day and snapped a four-session losing streak.
May closed up 48 points to 56.41 cents, in the upper third of its 83-point range from down 12 points at 55.81 to up 71 points at 56.64 cents. It chopped back and forth in two-sided price action after touching the low around 8:40 a.m. CST and the high about 45 minutes later.
A weaker U.S. dollar index offered support. Maturing March closed up 38 points to 58.43 cents, July rose 39 points to 56.16 cents and December finished up 35 points to 56 cents.
Talk circulating this week indicated that April now appears the most frequently mentioned possibility as a starting time for sales from ChinaΆs cotton reserves.
Volume slowed to an estimated 20,257 lots from 29,590 lots the previous session when spreads accounted for 12,306 lots or 42%, EFS 25 lots and EFP 13 lots. Options volume totaled 1,576 calls and 3,639 puts.
Net U.S. all-cotton export sales of 189,500 running bales during the week ended Feb. 25, up from 121,400 RB the previous week, boosted 2015-16 commitments to 6.961 million RB.
Commitments or outstanding sales plus shipments narrowed the gap behind bookings a year ago, when weekly cancellations exceeded sales, by 246,000 RB to 2.659 million RB or to 28% from 30%. Cumulative sales reached 75% of the USDA forecast, compared with 88% of final shipments at the corresponding point last season.
All-cotton shipments of 221,900 RB, up from 180,500 the week before, boosted the total for the season to 3.864 million RB. The lag behind exports a year ago widened to 853,000 RB or to 18%. Shipments were 42% of the USDA estimate, compared with 43% of final 2014-15 exports a year ago.
To achieve the USDA forecast, shipments need to average roughly 243,200 RB a week, while weekly sales averaging about 102,500 RB would match the export projection.
Sales for shipment next season of 3,600 RB, down from 18,700 the prior week, brought 2016-17 commitments to 922,900 RB, up 184,800 RB from forward bookings a year ago.
Meanwhile, on the competitive-pricing scene, the average of the five lowest-quoted world growths for the Far East fell 137 points to 63.04 cents during the week ended Thursday, according to USDA, while the lowest-priced U.S. cotton landed there fell 185 points to 65.10 cents.
The U.S. premium thus narrowed 48 points to 2.06 cents. The adjusted world price for the week ending next Thursday, reflecting transportation and quality differentials, is figured at 43.29 cents, down from 44.66 cents.
This results in a corresponding marketing loan gain for the program week ahead of 8.71 cents. There will be no fine count adjustment for qualities better than 31-3-35.
Futures open interest expanded 2,680 lots Wednesday to 205,543, with MarchΆs down 31 lots to 266 and MayΆs up 483 lots to 123,851. Cert stocks grew to 77,624 bales from 76,303 bales. The stocks previously reported for March 1 were understated by 2,000 bales, the exchange said. Awaiting review were 3,604 bales.
