Drought expanded in the Southeast and the Delta still needed rain. Rayville classing office downshifted. Gins operated around the clock in the Texas Plains. Snow fell in upper elevations of the far West.
Cotton futures settled lower on continued light volume Tuesday, down 62 to 89 points, with benchmark March giving back nearly all the prior dayΆs gain.
March lost 72 points to close at 71.30 cents, in the lower half of the 123-point range established by early morning from up eight points at 72.10 to down 115 points at 70.87 cents. It traded within MondayΆs range and closed back below its nine-day moving average.
Maturing December posted the biggest loss, settling at 72.38 cents, while December 2017 finished down 75 points to 69.67 cents.
Broad losses in commodities in the face of U.S. dollar index weakness and tumbling oil prices may have contributed to pressure on cotton. West Texas Intermediate crude traded down 3.8%.
Volume was estimated at 16,747 lots, compared with 15,809 lots the previous session when spreads accounted for 2,727 lots or 17% and EFP 43 lots. Options volume totaled 2,310 calls and 3,452 puts.
Mostly sunny to fair conditions prevailed across the entire Southeast during the week ended Thursday, capping several months of dry weather, USDAΆs Agricultural Marketing Service reported in a weekly cotton review.
Moderate to exceptional drought expanded as several weather stations in Alabama, Georgia and South Carolina recorded the driest three-month period on record, according to the Southeast Regional Climate Center. Lack of moisture has reduced yield potential on dryland acreage in East Georgia and North Alabama.
Reports indicated that some merchants have canceled contracts in areas of North Carolina affected by flooding earlier. Modules accumulated on gin yards across the region and ginning continued uninterrupted.
Conditions remained drier than normal in the Delta, even with brief, heavy rainfall early in the period in the north and scattered showers in the south. Considerably more rain was needed to recharge depleted soil moisture and replenish rivers, lakes and ponds.
A number of gins completed annual operations throughout the North Delta, while larger gins maintained their work schedules. The Memphis and Dumas classing offices maintained steady work schedules to keep pace with sample receipts.
Ginning was rapidly drawing to a close in the South Delta, though some larger gins expected to operate into December. The Rayville classing office scaled back operations to one shift five days a week to handle the remaining workload, which was about 90% completed for the season.
In Texas, ginning continued in the Winter Garden and Upper Coastal Bend, while clear, dry weather allowed harvesting to advance in the West Texas Plains. Local sources estimated the harvest was around 50% completed in the High Plains and 30% in the Rolling Plains.
Gins in the Plains operated around the clock. Peak sample receipts moved into the Lubbock, Lamesa and Abilene classing offices. The Lubbock and Abilene offices operated three seven-hour shifts to keep up with receipts. In the Lamesa territory, per-acre yields averaged around 1-1/4 bales off dryland acreage and 3-1/2 bales off irrigated ground.
Snow fell in the higher elevations of Arizona and California, which will help in replenishing reservoirs. Harvesting and ginning continued uninterrupted.
Futures open interest expanded 1,807 lots Monday to 255,473, with DecemberΆs down 79 lots to 1,113 and MarchΆs up 1,370 lots to 184,224. Cert stocks grew 737 bales to 52,665. There were 3,078 newly certified bales and 2,341 bales decertified.
