Analysts project U.S. ending stocks at 2.8 million bales, down 200,000 bales from USDAΆs December estimate and 1.1 million bales from the 2012-13 carryout.
Cotton futures settled in the red Thursday after surging abruptly to a triple-digit gain just shy of the previous-session high.
Spot March settled down 33 points to 82.81 cents, its lowest close since Dec. 23 and just off the low of its 190-point range from up 149 points at 84.63 to down 41 points at 82.73 cents.
March found a vacuum of selling on its sudden burst to the high until it reached about the 84.50 area where trade selling capped the rally. It held on the downswing just above MondayΆs low.
The May and July contracts both fell 41 points to 82.81 and 82.67 cents, respectively, while December eased off two ticks to 77.46 cents.
Volume based largely on electronic figures was estimated at 27,300 lots, against a cleared 26,650 lots the previous session when spreads accounted for 11,351 lots or 43%, EFP 149 lots and EFS 102 lots. An exchange estimate wasnΆt available.
U.S. ending stocks are expected to fall to a tight 2.8 million bales this season, according to the average of analystsΆ estimates in a survey by The Wall Street Journal.
This is down from 3 million bales projected in last monthΆs USDA supply-demand report and from 3.9 million bales in 2012-13. Updated USDA estimates are scheduled for release at 11 a.m. CST Friday.
Carryout estimates ranged from 2.7 million to 3 million bales. The average is the smallest carryover since 2.6 million bales in 2010-11 and the second lowest since 2.61 million bales in 1995-96.
Analysts estimated exports at an average of 10.5 million bales within a range of 10.4 million to 10.7 million, compared with 10.4 million projected by USDA last month and 13.03 million shipped in 2012-13.
Exports, constrained by tight supplies and lower imports by China, would remain the smallest since 2000-01 when they totaled only 6.74 million bales.
No survey estimate was made on domestic mill use, which USDA forecast at 3.6 million bales, up 100,000 bales from last season. Cotton yarn exports to China and other countries have been credited with helping to boost domestic consumption along with an improving economy and the “buy USA” campaign.
The survey showed an average crop estimate of 13 million bales, down slightly from 13.07 million projected by USDA in December and 25% below last seasonΆs output of 17.32 million.
This would remain the smallest crop since 2009-10 when growers harvested 12.19 million bales. Crop estimates ranged from 12.9 million to 13.1 million bales.
The USDAΆs total supply estimate of 16.98 million bales — the crop plus beginning stocks and imports of 10,000 bales — is the smallest in 29 years, and talk has circulated that prices may have to ration export sales. But sales have weakened sharply the last two reporting weeks.
Futures open interest eased 36 lots Wednesday, with MarchΆs down 1,109 lots to 110,121 and MayΆs up 210 lots to 35,389.
Certificated stocks increased for the third consecutive day, rising 5,381 bales to 42,543. A licensed warehouse in Memphis has notified the exchange that the facility suffered damage from a storm. The extent of the damage is still being assessed. Approximately 2,900 bales of certificated cotton were stored at the warehouse.
World values as measured by the Cotlook A Index fell 140 points Thursday morning to 88.40 cents. The index premium to WednesdayΆs December futures settlement narrowed 13 points to 5 cents.
