Market trades independently of outside influences. Prospective cotton acreage pondered on the Texas Plains as wheat condition eyed.
Cotton futures fell to new low closes for the move amid follow-through selling Tuesday, trading for the most part independently of outside influences and settling just off the dayΆs lows.
The spot May contract closed off 98 points to 83.35 cents, three ticks off the low of its 168-point range from up 67 points at 85 cents to down 101 points at 83.32 cents. It closed just below FridayΆs low at its lowest settlement since Feb. 26.
Most-active July settled down 70 points to 85.42 cents, seven ticks below last weekΆs low after trading from up 49 points at 86.61 to down 82 points at 85.30, and December lost 43 points to close at 84.75 cents, trading from up 41 points at 85.59 to down 48 points at 84.70.
Volume increased to an estimated 36,900 lots from 28,089 lots the previous session when spreads totaled 13,213 lots or 47%, EFS 3,130 lots and EFP 94 lots. Options volume totaled 4,478 calls and 4,149 puts.
New questions about the acreage that may be planted in cotton this spring have arisen after hard freezes threatened the winter wheat crop in the Texas High and Rolling Plains last week.
Calvin Trostle, Texas A&M AgriLife Extension Service agronomist in Lubbock, and Clark Neely, extension state small grains and oilseeds specialist in College Station, will attend a series of meetings across the region beginning Wednesday to help evaluate samples participants bring and conduct training sessions on spotting freeze damage.
“We have indeed unquestionable and major potential injury on our wheat crop for grain,” Trostle said in an extension release. “The absolute temperature is one factor and the duration of those temperatures is another. When combined, these two issues significantly raise the injury potential.”
Temperatures fell to around 20 to 22 degrees in the northwest Plains and north of Lubbock, 20 degrees in the Amarillo area, 22 to 25 degrees in the southeast Panhandle, and about 15 to 20 degrees north of the Canadian River. Some areas were below 28 degrees for about 24 hours.
“There has been enough jointing now into the Panhandle that the growing point most likely experienced the cold temperatures that cause damage,” Trostle said.
“Also, the strong wind speed overnight April 9-10 probably circulated the temperatures farther into the canopy, whereas on still nights with only a light breeze, this probably doesnΆt happen as readily.
“Likewise, on a windy night, the low end of the field, if there is one — for example, a playa bottom or a draw — might be less likely to demonstrate injury relative to the rest of the field.”
With wheat producers and others still evaluating condition of the crop, the acreage that might be replaced with cotton is uncertain.
But some knowledgeable industry sources at Lubbock estimate at the moment that cotton plantings on the High Plains could range from roughly 3.75 million to 3.9 million acres, down about 8% to 11% from last yearΆs 4.22 million.
This would allow for some freeze-damaged wheat to be replaced with cotton, depending upon a lot of variables — weather prior to cotton planting time, individual crop insurance situations, and possible replacement with grain sorghum, among others.
Futures open interest fell 5,172 lots Monday to 189,975, with MayΆs down 5,259 lots to 28,535, JulyΆs up 139 lots to 109,559 and DecemberΆs down 52 lots to 49,521. First notice day for May deliveries now is five trading sessions ahead.
Certificated stocks grew 5,844 bales to 462,403 and 22,327 bales awaited review for a possible total of 484,730 bales.
World values as measured by the Cotlook A Index fell 90 points Tuesday morning to 92.20 cents. The index premium to MondayΆs May futures settlement widened 35 points to 84.33 cents.
