Slowing expected in U.S. weekly export sales. China has retained a slim lead as the top all-cotton buyer for the season, but Turkey has become the top upland buyer. Light on-call fixations reported in March.
Cotton futures settled mixed on this first trading day of 2014, finishing unchanged to down 60 points in current-crop deliveries and up 25 to 73 points in traded new-crop contracts.
Spot March lost the most, settling at 84.04 cents to finish in the lower half of its 157-point range from down 114 points at 83.50 cents to up 43 points at 85.07 cents. It slipped below intraday lows of the previous two sessions and closed at a four-session low settlement.
The May contract dipped 38 points to close at 84.02 cents, July finished flat and December gained 51 points to 78.94 cents.
Volume quickened to an electronically estimated 20,100 lots from 14,621 lots the previous session when spreads totaled 5,632 lots or 39%, EFP 839 lots and EFS 91 lots.
U.S. export sales to be reported Friday — a day later than usual because of the New YearΆs Day holiday — for the week ended Dec. 26 are expected to slow from the previous weekΆs 221,600 running bales of upland and 230,200 bales of all cotton.
The report will be issued by USDAΆs Foreign Agricultural Service at 7:30 a.m. CST. The expected slowdown is linked mainly to holiday influences. March futures during the reporting week averaged 82.87 cents on a closing basis, against 83.18 cents the previous week.
Weekly sales have exceeded expectations lately — primarily on bookings by Turkey — and have been a key factor in pushing prices higher. Turkey has been the leading buyer the last two reporting weeks and for seven of the last eight weeks.
China has retained a fractional lead as the top all-cotton buyer for the season, booking 1.681 million running bales or 23% of the combined upland-Pima commitments, while Turkey has ranked a close second on purchases of 1.655 million bales or 22.7%.
However, Turkey has claimed the top spot on upland sales on purchases of 1.651 million bales or 24%, compared with 1.359 million bales or 20% for China. Mexico is the third largest upland buyer with 937,000 bales or 16%. China has booked 321,100 bales of Pima or 64% of those commitments.
Meanwhile, light on-call fixations in the March contract totaled 600 lots on the mill side and 592 lots on the producer side during the week ended Dec. 20, according to Commodity Futures Trading Commission data.
This pared unfixed positions to 22,419 lots and 7,641 lots, respectively, and left the net call difference little changed on a dip of eight lots to 14,778, which was 13.27% of MarchΆs expanding open interest. The unfixed mill position outweighed that of producers by a ratio of 2.93:1.
Futures open interest grew 1,243 lots Tuesday to 172,171, with MarchΆs up 587 lots to 111,938 and MayΆs up 329 lots to 33,420. Certificated stocks were unchanged at 34,087 bales.
The Cotlook A Index of world values was unchanged Tuesday morning at 89.70 cents, nudging the premium to TuesdayΆs March futures settlement out two points to 5.06 cents. The widely watched index ended 2013 with a gain for the year of 675 points or 8.1%.
