Speculative selling amid slow global demand and poor technical action broke cotton futures out of its recent consolidation last week.

Spot December fell 470 points for the week ended Thursday to close at 96.86 cents, its lowest finish since Aug. 11. Spread-laden trading accounted for as much as 52 percent of the daily volumes.

DecemberΆs settlement premium to March narrowed to 144 points from 269 points, while the March-May inversion tightened to 19 points from 79 points. Some analysts say the inversions eventually may swing toward contango — wherein a forward delivery trades above the expected spot price at contract maturity — unless global demand comes to the fore.

Scale-down trade and mill fixation-type buying failed to stem the skid. Mills were reported waiting for lower prices linked to a record world output estimated at 124.2 million bales, up 8 percent from last season, as Southern Hemisphere producers push for bigger crops.

Cash sales on The SeamΆs grower-to-business exchange rose to 3,467 bales from 1,514 bales the prior week. The cotton changed hands on prices averaging 98.66 cents, reflecting premiums over loan redemption rates of 44.40 cents. Daily price averages ranged from 92.67 to 104.24 cents.

Business-to-business trading quickened to 22,093 bales from 7,564 bales. Prices averaged 91.58 cents and premiums 41.82 cents. The cotton brought daily average prices ranging from 83.37 to 98.37 cents.

The latest weekly USDA report showing weak export sales and shipments on the heels of bearish October supply-demand estimates released earlier drew little initial market reaction but reinforced negative demand news.

Net U.S. all-cotton export sales for delivery this season slowed to 60,100 running bales during the week ended Oct. 13 from 63,000 bales the previous week. Gross upland sales were 83,800 bales and cancellations were 24,500 bales.

Shipments fell to 73,900 bales from the prior weekΆs 89,600 bales. Upland exports of 71,600 bales were down 20 percent from the week before and 4 percent from the prior four-week average. Shipments now need to average roughly 247,000 running bales week to achieve the USDA forecast.

Total foreign supplies are rising this season to the highest in four years, according to USDA estimates, and are offering increased export competition for U.S. cotton. And limited growth predicted for the global economy is expected to result in stagnant foreign cotton consumption.

Based on the latest USDA estimates, the gap between foreign mill use (110.6 million bales) and production (107.6 million bales) is expected to decline to 3 million bales. This is a big drop from two years ago when the crop shortfall exceeded 26 million bales and set the stage for the ensuing historic bull market.

The gap is forecast below 5 million bales for the first time since 2004-05 and to the smallest since 1998-99 when it was 2.18 million bales on a crop of 72.18 million bales and mill use of 74.36 million bales.

On the U.S. crop scene, harvesting advanced eight percentage points during the week ended Oct. 16 to 34 percent complete, four percentage points behind last year but five points ahead of average.

The harvest was most advanced in Louisiana at 93 percent, Mississippi at 72 percent, Missouri at 58 percent and Arkansas at 56 percent. It was ahead of the average in Georgia, the Carolinas and Texas and lagged in Alabama, Arizona, California, Kansas, Oklahoma, Tennessee and Virginia.

Boll opening reached 94 percent, even with a year ago and five points ahead of the five-year average.

Crop ratings improved slightly, rising for the fourth consecutive week, with good to excellent unchanged at 30 percent, fair up a point to 29 percent and poor to very poor down a point to still the highest on record for this time of year at 41 percent. Weekly ratings become less important as more of the crop comes off the stalk.

The drought-shortened Texas High Plains crop appeared to have sustained relatively little damage Monday from an intense dust storm, propelled by winds gusting to more than 70 miles per hour at several locations, industry sources said.

Though the winds blew “quite a bit” of open cotton in looser-boll varieties to the ground in places, the crop as a whole held in the bur remarkably well. Cotton loosened but still in the bur could be vulnerable to losses from more winds or rain, however.

Sand embedded in open cotton could produce more wear and tear on harvesting and ginning machinery but will be cleaned before it reaches textile mills. The dust storm, technically called a “haboob,” wasnΆt accompanied by rain that could have stained or discolored the lint and lowered grades.

Producers have continued shredding some cotton that had been watered but still wonΆt produce enough under the worst one-year drought on record to make harvesting worthwhile.

The Farmers Cooperative Compress at Lubbock expects to handle only 790,000 bales or less this season, roughly a third of its five-year average receipts of 2.3 million bales, said Ron Harkey, president and CEO.

The FCC has 208 warehouses with approved cotton storage space of 11.352 million square feet and plans to operate only 83 of the facilities this season with about 40 percent of last yearΆs workforce, Harkey said.

In international news, ChinaΆs cotton imports rose 26 percent in September from a year earlier to 252,700 metric tons (1.16 million bales), Reuters reported, quoting an industry website that cited customs data.

Imports in the first nine months of the year totaled 1.94 million tons (8.91 million bales), down 9.7 percent from the prior year, said the report on a China National Cotton Reserves Corp. website.

In the marketing year that began Aug. 1, China has booked 2.478 million running bales of U.S. cotton through Oct. 13. This was 35 percent of total U.S. export sales. The next largest buying destinations were Turkey with 733,000 bales and Mexico with 716,500 bales.