Market Movement from 18th Mar 2024 to 23rd Mar 2024.
• The future outlook suggests a further decline in May future due to certified stock weight. In the week ending May, there was a loss of 241 points, followed by a 174-point loss in July. Consequently, July now carries an inverse trend. However, there's a slight improvement in the new crop December, gaining 27 points week over week. As a result, the inverse has narrowed to 790 points with July futures.
Market Movement from 04th Mar 2024 to 09th Mar 2024.
• The past week has been marked by significant volatility in the New York (NY) futures market, experiencing both limit ups and limit downs. Despite dull export sales, the market saw an upswing with improved shipment figures, leading to a limit up and a somewhat bullish World Agricultural Supply and Demand Estimates (WASDE) report.
COTTON: This month’s 2023/24 U.S. cotton forecasts show lower production and ending stocks relative to last month. Production is reduced 334,000 bales to 12.1 million, based on the March 8 Cotton Ginnings report. The final estimates for this season’s U.S. area, yield, and production will be published in the May 2024 Crop Production report. Ending stocks are 300,000 bales lower this month at 2.5 million.
• In the month of February, NY Future experienced a roller coaster ride, fueled by financial support and strategic acquisitions. Breaking through all psychological resistance barriers in the first week, it surged past the 90-point mark for the first time. By the end of first week, there were indications that NY Future might surpass the dollar threshold, reaching a high of 103.80 and closing near 99.57. Overall, NY May futures demonstrated a substantial gain of 13.16 points month-over-month.
Market Movement from 26th Feb 2024 to 02nd Mar 2024.
• The New York futures market witnessed a highly volatile week, marked by both limit-up and limit-down days. The value of NY May surged to a new high, breaching the dollar mark and reaching an impressive 103.80 cents from its initial position at 93 cents. However, the market experienced a retracement, settling back to 95.57. Ultimately, despite the significant fluctuations, the weekly gain amounted to just 208 points.
Market Movement from 19th Feb 2024 to 24th Feb 2024.
• In the week-to-week comparison, the New York March futures gained 106 points, whereas the May futures experienced a loss of 93 points. With March now concluded, the focus has shifted to the front month, which is now represented by the New York May futures.
At Current Prices, Cotton Is a Speculative Market. And That’s Okay.
Feb 23, 2024
Run Forrest run! And boy, did he do his running.
The March contract ran to a high of 95.42 cents before giving up on its first notice day, giving way to the May futures contract as the spot month. Thus, the stage is set for May’s challenge of 96 cents. The pure technician suggests a run to 101 cents…which will not happen!
Market Movement from 05th Feb 2024 to 10th Feb 2024.
• The NY March future experienced a significant surge in a huge bull run, driven by bullish WASDE (World Agricultural Supply and Demand Estimates) for the US current year. Technical indicators showed a notable crossing of the 90 cents mark for the first time in two seasons. This prompted a combination of technical buying, new speculative buying, and some short covering, resulting in a substantial week-over-week gain of 467 points.
Market Movement from 12th Feb 2024 to 17th Feb 2024.
• Despite strong buying from funds and speculators, NY futures have faced resistance at the 96 cents level, resulting in a partial retracement of gains. Despite March gains nearing a crucial point, the market remains bullish. Export sales, although lower than previous weeks, are not viewed negatively, contributing to a positive market outlook.
COTTON: The 2023/24 U.S. cotton balance sheet has lower ending stocks relative to last month, with higher exports and lower mill use, while production is unchanged. The export forecast is raised 200,000 bales to 12.3 million based on a strong pace of shipments and sales to date. Similarly, projected mill use is reduced 150,000 bales as U.S. domestic spinning activity remains low. Ending stocks are now estimated at 2.8 million bales, equivalent to 20 percent of total disappearance.
Comments Prior to the USDA February WASDE Release. Early report due to surgery schedule.
Run Forrest Run! Old crop and new crop headed higher.
Once again, Never Give Up On Cotton. Granted, what goes up does come down, and it is not going to be all roses. Yet, the old crop’s run to 90 cents is real, and a little more. Too, the 2024 new crop December will hit the 85 cent mark and will find considerable pressure to move to 90 cents and better.
Market Movement from 29th Jan 2024 to 03rd Feb 2024.
• This week witnessed a bullish trend in the New York future market. Supported by strong export sales and impressive shipment figures, NY Future for March broke through and closed above 87 cents for the first time, registering a substantial gain of 274 points.
• This month, the bulls in the New York Futures market were delighted by the favorable cotton balancesheet of the United States as presented in the WASDE (World Agricultural Supply and Demand Estimates). The market also received strong support from robust export sales, contributing to a positive sentiment among traders.
• Speculative interest in cotton saw a return, leading to a steady increase in open interest throughout the month.
Cotton continued its bullish run all week, all but challenging the top end of the yearlong-plus trading range. As expected, price resistance at the 86-cent trading level halted the advance.
Market Movement from 22nd Jan 2024 to 27th Jan 2024.
• Greetings on Republic Day to all our cotton friends.
• The New York (NY) futures market experienced a volatile week, with the NY March crossing the 85-cent mark and dipping slightly below the resistance level of 86 cents.
Market Movement from 15th Jan 2024 to 20th Jan 2024.
• With the assistance of strong export sales, NY March, successfully broke through the psychological resistance at 82 cents and surpassed a new high level at 84 cents. This resulted in a week-over-week gain of 264 points.
• In the latest U. S. Export Sales Report for the week ending 11-Jan-2024, U.S. export sales data for the 2023-2024 season reveals net upland sales of 4,20,000 bales, with upland shipments reaching 2,57,700 bales.
“The Fabric of Your Life” is demonstrating a bit of market excitement. Let us hope it can continue.
The cotton market has turned a bit volatile, just as the equity and finance markets have. Long-term interest rates are increasing slightly as the market debates if, when, and should the Fed even push short-term rates lower.
MARCH FUTURES FINISHED WITH STRONG GAINS FOR THE SECOND CONSECUTIVE WEEK
• Stock Market Managed to Recover Losses by the End of the Week • U.S. Export Sales Report Held Phenomenal Sales and Shipments for Week Ending January 11
Market Movement from 08th Jan 2024 to 13th Jan 2024.
• Team Gujcot extends warm wishes for a joyous Makar Sankranti, Happy Lohri, and a delightful Pongal to all our friends in the cotton community. May the festivities bring prosperity, happiness, and abundant success to everyone!
USDA’s January supply demand report doused water on the market’s attempt to light up futures prices. The price outlook for the nearby March contract remains, as the Varner Boys commented last week, boring. Prices did climb above the short-term moving averages, but expectations for any lasting positive market response is lacking. The On-Call report continues to be negative (or as another said, “There is nothing positive in it.”).
MARCH FUTURES FINISHED WITH STRONG GAINS AFTER TRADING SIDEWAYS MOST OF THE WEEK
• CPI Added Layer of Uncertainty to Fed’s Decision • U.S. Production Cut to 12.434 Million Bales, World Use Cut to 112.43 Million Bales • U.S. Export Sales and Shipments Unexpectedly Strong for the Week Ending January 4
COTTON: This month’s U.S. 2023/24 cotton forecasts include lower production, exports, and ending stocks. Production is 342,000 bales lower, at 12.4 million bales, largely due to reductions in Texas. Exports are 100,000 bales lower, and ending stocks are 200,000 bales lower at 2.9 million. The season-average upland price received by farmers is projected 1 cent lower this month at 76 cents per pound.
Cotton Prices Will Change in 2024. Just Don’t Ask When or Why.
Stealing a word from the Varner Boys, cotton trading began the New Year just as it ended the old one –“boring.” That is changing this marketing year. Don’t ask me how, why, or when. I do not know that yet. We will figure it out together.
MARCH FUTURES TRADED SIDEWAYS DURING THE HOLIDAY-SHORTENED TRADE WEEK
• Outside Markets Pullback to Start 2024 • U.S. Export Sales Slowed During the Holiday Season • Cotton Grower Magazine Survey Reported Cotton Acres Will Hold Steady in 2024
Market Movement from 25th Dec 2023 to 30th Dec 2023.
• NY March futures exhibited a notable week-over-week increase, rising from 79.76 cents on December 22nd to 81.00 cents on December 29th, reflecting a gain of 1.24 cents. Although robust export sales was ignored by market in low volume and festival time. Meanwhile, comparing month-to-month performance, NY March futures saw a rise from 80.06 cents on November 30th to 81.00 cents on December 29th, marking a gain of 0.94 cents.
Gujcot First Quarterly Rate Movement Report - 2023-24
• In the month of October, both NY December and March futures commenced trading near 88 cents, experiencing a gradual decline. The market remained relatively stable during December, with NY March operating within a narrow range of 79 to 82 cents. The downward trend during this period was primarily attributed to factors such as the Gaza war and the Federal Reserve's decisions to decrease interest rates.
The New Year is threatening to open a door to higher prices for cotton. The final week of the year saw higher prices each day – a very unusual trading pattern, and “unusual” can typically be associated with bullish news.
Market Movement from 18th Dec 2023 to 23rd Dec 2023.
• NY March, the New York market exhibited a subdued performance, maintaining a narrow trading range as participants awaited a clear direction. NY Mar futures registered a decline from 79.93 on 15-Dec to 79.76 on 22-Dec, reflecting a week-over-week loss of 0.17 cents.
Cotton prices for the week traded in a high-to-low range of only 190 points. Every attempt to move beyond eighty-two cents was quickly stifled by grower selling while downside support held firm at 80 cents before giving way slightly on Friday closing at 79.83. This was disheartening when at the same time the Dow, S&P 500, and NASDAQ were hitting all-time highs.
Price Swings and Weak Demand Continue to Feed the Cotton Bears*
There is a bit of procrastination here. I really do not want to communicate these words. It is time to be bullish. I want to get there. I just cannot get there. The big tease is still ongoing.
Markets can be very fickle. After lingering aimlessly around eighty cents for most of last week, current crop futures traded limit up Thursday for no apparent reason. Certainly, a head-scratcher for it followed mediocre export sales and little fundamental or economic news. Nevertheless, cotton prices had their biggest one week jump since late August closing Friday at 81.44 for a gain of 202 points.
MARCH FUTURES FINISHED THE WEEK ENDING DECEMBER 7 WITH STRONG GAINS
• Stock Market was Mixed this Week, but Managed to Maintain November’s Gains • S. Production Cut to 12.78 million bales and World Use was Cut to 113.73 million bales • U.S. Export Sales were Down for the Week Ending November 30
COTTON: This month’s 2023/24 U.S. cotton forecasts include lower production, mill use, and ending stocks. Production is reduced 314,000 bales to 12.8 million largely due to a 500,000-bale decrease in the Texas crop. U.S. mill use is reduced 150,000 bales as spinning activity continues to lag, and at 1.9 million bales, is expected to be its lowest since 1884.
Market Movement from 27th Nov 2023 to 02nd Dec 2023.
• The current leading month for Future March is now experiencing a stagnant phase within a narrow trading range, awaiting a clear direction. The closing value for NY March stands at 80.99, reflecting a weekly loss of 157 points.
Market Desperately Searching For Direction December 4, 2023
After falling a precipitous 173 points on Monday, cotton prices found some footing and traded narrowly from that point on. March futures settled at 79.42, a loss of 157 points. It is obvious this market is desperately searching for direction. Unfortunately, for now the only steering currents are a lack of demand and grower pricing pressure. Both of which are sure to stymie any significant advances.
• November was typically dominated by bears, characterized by sluggish trading throughout the month. In New York, December exhibited a wide trading range of 74.89 to 80.39 cents per lb, whereas March, the current lead month, remained stuck in a narrow range of 77.70 to 82.34 cents per lb. Month-over-month, December experienced a loss of 182 points, while March concluded with a 345 points loss.
How the Grinch Stole Cotton’s Christmas Dec 01, 2023
The Grinch has certainly stolen Cotton. The cotton market offered its first gifts of the Christmas season to the Bears, while the Bulls are left staring at unopened presents stacking up on the Bears’ side of the tree.
COTTON MARKET WAS OVERALL LACKLUSTER TO WRAP UP THE MONTH OF NOVEMBER
• Stock Market was Mixed this Week, but Made Strong Gains in November • U.S. Export Sales were Healthy for the Week Ending November 23 • WASDE Report will be Released on December 8
If you like watching paint dry or chrome rust, last week’s cotton market was the place to be. Although, after the zaniness of the past few weeks, it was somewhat welcomed. With merchants closing early on Wednesday followed by an abbreviated trading session on Friday, volume was well below average. Moving in a narrow range of only two cents over the course of the week, March futures settled at 80.99 for a small loss of fifty-two points.
WITH THE DECEMBER CONTRACT ALL BUT GONE, TRADERS SHIFT FOCUS TO THE MARCH CONTRACT
• Stock Market Continued to Climb Higher for the Fourth Consecutive Week
The holiday-shortened trade week was busy with many traders clearing out the rest of their December positions. First Notice Day is on Friday, and daily volume has been active leading up to it.
Market Movement from 20th Nov 2023 to 25th Nov 2023.
• NY Mar futures traded in narrow range this week. With consecutive large sell to China it covered major loss and recorded a decrease from 81.51 on 17-Nov to 80.99 on 24-Nov, reflecting a week-over-week loss of 0.52 cents.
Last week’s activity centered around spread trading as December prepares to exit the board and March becomes the official cover month. Though prices moved in a consolidated range both contracts posted triple-digit gains, erasing nearly all the previous week’s losses. December traded as high as 79.88 before settling at 78.92 for a gain of 160 points. While March traded as high as 81.87 before settling at 81.51 for a gain of 201 points.
Market Movement from 13th Nov 2023 to 18th Nov 2023.
• This week, the New York futures market demonstrated stability with a modest upward trend. In particular, the December New York futures saw a gain of 160 points, while the March futures experienced a more significant increase of 201 points.
A Better Week, as Lower Cotton Prices Lift Exports
Nov 17, 2023
Cotton prices held the line in weekly trading as last week’s low prices encouraged good export sales. That, coupled with government released economic data hinting, on the surface, at an improved economy, gave prices a higher nudge every day of the week.
Market Movement from 06th Nov 2023 to 11th Nov 2023.
• Wishing to all our cotton friends a joyous and prosperous Diwali and a New Year filled with abundance. May this festival illuminate your lives with light, bless you with good health, and bring forth wealth and success.
• Team Gujcot extends our warmest wishes for an earning-rich and stress-free year ahead for all our cotton friends.
COTTON PRICES CONTINUED TO DECLINE, REACHING AN 11-MONTH LOW DURING THE WEEK
• Stock Market Was Higher Most of the Week • U.S. Production was Raised 270,000 Bales to 13.09 million Bales on November WASDE Report • Strong Export Sales were Reported but Shipments Continue to Disappoint • As of November 5, 57% of the 2023/24 Crop Has Been Harvested Across the Cotton Belt
COTTON: The 2023/24 U.S. cotton balance sheet shows slightly lower consumption but higher production and ending stocks this month. Production is 273,000 bales higher, at 13.1 million bales, as lower production in Texas is more than offset elsewhere. Domestic mill use is 100,000 bales lower, reflecting the pace of recent consumption, and exports are unchanged, leaving ending stocks 400,000 bales higher at 3.2 million bales or 22.5 percent of use.
After months of repeated challenges, our biggest fear was market support in the low 80’s would break. How appropriate it would do so Halloween week. It appears sellers were spooked by frightful technical signals and a geopolitical environment which could have horrific consequences. As a result, after three consecutive days of triple digit losses the market closed below 80 cents for the first time since June.
Market Movement from 30th Oct 2023 to 04th Nov 2023.
• On October 27, New York December cotton futures were valued at 84.38, but by November 3, their price had dropped to 79.62, marking a weekly decrease of 4.76 cents. NY December has dropped below 80 cent technical level so it open door of new bottom.
DECEMBER FUTURES SETTLED BELOW 80.00 CENTS PER POUND FOR WEEK ENDING NOVEMBER 2
• Stock Market Finished Higher after the Federal Open Markets Committee Held Interest Rates Steady • Marketing Year High Reached in Both Upland and Pima Sales for the Week Ending October 26 • Hard Freeze and Wet Weather Stalled Harvest, but Warmer Temperatures Expected in Week to Come
• In October, the New York Futures for December consistently fluctuate within a price range of 82 to 88 cents. On the other hand, March futures consistently exhibit a carrying cost with a price range of 84.5 to 88.5 cents.
Market Movement from 23rd Oct 2023 to 28th Oct 2023.
• During the past week, the New York December market experienced a notable increase of 198 points week-over-week. This gain can be attributed to a combination of improved export sales and advantageous mill fixation rates.
"Navigating Challenges: A Recap of the 2022-23 Indian Cotton Market Season"
The Indian cotton market in the 2022-23 season witnessed a series of unique challenges and fluctuations, impacting both cotton mills and farmers. Here we provide an overview of the season, highlighting key events and factors that influenced cotton prices and market dynamics.
DECEMBER FUTURES FELL BELOW RECENT LONG-TERM TRADING RANGE FOR MOST OF THE WEEK ENDING OCTOBER 27
• U.S. GDP Surged in Third Quarter, Beating Market Expectations • An Uptick in Demand for U.S. Cotton Reported for Week Ending October 19 • Adverse Weather in Coming Week Could Hinder Harvest Activities Across Texas, Oklahoma, and Kansas
Positive Week for Cotton, But Beware Growing Consumer Stress
Oct 27, 2023
Cotton prices were down two of the five trading days this week but still closed on the positive side of the 9-, 100-, and 200-day support lines. December did settle 198 points higher on the week – a real market winner compared to the Dow, NASDAQ, and Russell 2000. December futures ended the week at 84.38, but down 21 points in Friday’s trading but up 198 points on the week.
DECEMBER FUTURES FELL BELOW RECENT LONG-TERM TRADING RANGE FOR THE WEEK ENDING OCTOBER 19
• U.S. Retail Sales Higher than Expected, but Clothing Sales Declined, Adding Pressure to Cotton Prices • Lackluster Demand for U.S. Cotton Reported for Week Ending October 12 • Favorable Harvest Weather Set to Continue in Upcoming Week
Market Movement from 16th Oct 2023 to 21st Oct 2023.
• This week in the New York Futures market, bearish sentiment dominated as the daily intraday performance of New York December futures experienced consistent downward movements, ultimately closing with narrow losses. The ongoing Israel-Hamas conflict played a significant role in shaping the market's performance during this period.
DECEMBER FUTURES FELL TO LOWER END OF TRADING RANGE, SETTLING LOWER FOR FOUR CONSECUTIVE SESSIONS
• CPI Marginally Higher than Expected, Increasing 0.4% in September • U.S. Total Cotton Production Expected to be 12.817 Million Bales • Weak Sales and Poor Shipments Reported for Week Ending October 5 • Favorable Harvest Weather Expected Across West Texas, Oklahoma, and Kansas in the Coming Week
Market Movement from 09th Oct 2023 to 14th Oct 2023.
• The NY December future closed at 86.06, recording a weekly loss of 1.08 cents.
• The main highlight of the week was a pronounced pre-WASDE loss on Wednesday, which was followed by a noticeable rebound in prices on Friday. These fluctuations were accompanied by concerns arising from a new conflict in Gaza, which sparked moments of panic within the market.
COTTON: The 2023/24 U.S. cotton supply and demand estimates show lower production, exports, and ending stocks compared with last month. Production is 315,000 bales lower at 12.8 million bales, down 2 percent from a month earlier as lower yields in Texas offset gains elsewhere. With production projected lower and exports down 100,000 bales to 12.2 million, ending stocks are reduced 200,000 bales.
Gujcot Fourth Quarterly Rate Movement Report – 2022-23
We are here providing you comprehensive overview of the various factors affecting cotton prices and production during July-September period. Here's a summary of the key points:
1. Cotton Price NY Future Trends: The price of cotton in the NY futures market during July was in the range of 79-84 cents but moved higher to 84-88 cents in the following two months. There were attempts to break the resistance at 88 cents, but failed to sustain due to weaker demand and macroeconomic challenges.
Encouraging best describes the way cotton prices withstood last week’s onslaught of poor economic news. Its underlying strength was found in a shrinking crop. With eighteen percent of the U.S. crop now harvested less than favorable yields are fast becoming a reality. Traders weighing short supplies versus dismal demand are desperately seeking confirmation.
Market Movement from 02nd Oct 2023 to 07th Oct 2023.
• Welcome, all cotton enthusiasts, to the start of the new 2023/24 season! This marks the first weekly report of the season, and we extend our best wishes for a prosperous and successful season ahead to all our fellow cotton enthusiasts.
• NY Dec cotton futures closed at 87.15 on September 29th, slipped to 87.14 on October 6th, resulting in a week-over-week loss of 0.01 cents.
DECEMBER FUTURES FOLLOWED OUTSIDE MARKETS FOR THE WEEK ENDING OCTOBER 5
• Slew of Activity Caused Major Indexes to be Mixed • Healthy Demand for U.S. Cotton Reported for Week Ending September 28 • As of October 2, 18% of the U.S. Crop has been Harvested
Can the 90-Cent Cotton Market Barrier Be Breached?
Oct 06, 2023
Cotton prices fell below 87 cents on the week but quickly rallied, yet they were unable to trade up to 88 cents. Thus, after last week’s rally above 89 cents, the market fell back into another protracted line of back-and-fill trading.
The 90-cent technical resistance barrier continues to be “A Bridge Too Far.”
For the past three months cotton prices have traded in a range from 85 to 90 cents. Last week proved no exception. After prices fell to 85 cents, last week mill fixations and spec buying drove prices to a three-week high of 89.89. Unfortunately, ninety cents again proved insurmountable as grower hedging forced prices lower closing Friday at 87.15 for a weekly gain of 124 points. Such an advance with a government shutdown all but certain was very impressive.
DECEMBER FUTURES FINISHED HIGHER FOUR OUT OF FIVE TRADING SESSIONS
• Major Indexes were Mixed and Crude Oil Reached a 13-Month High • Market Ignored Poor Export Sales for Week Ending September 21 • As of September 24, 13% of the U.S. Crop has been Harvested
Market Movement from 25th Sep 2023 to 30th Sep 2023.
• The ICE December cotton futures traded at 87.15 cents per pound, reflecting an increase from its value of 85.91 cents on September 22nd. Throughout the week, there was a notable uptick in cotton prices, reaching a high of 89.89 cents per pound on September 28th, resulting in a week-to-week change of 1.24 cents to the upside. However, when comparing the monthly changes, the cotton futures showed a decrease.
Cotton’s Tight Price Range Faces Little Pressure to Change
Sep 29, 2023
This week’s cotton rally was technical based. Fundamentals have essentially prohibited the market from moving above the 90-cent mark, a resistance level that has withstood four challenges. The resistance line is neither battered nor bruised, but eventually a door that is continually kicked will break.
Dec cotton futures gave up 53 points on the week (the very same 53 points it gained last week) finishing at 85.91, with the Dec – Mar spread strengthening a bit to (84). Last week, our models predicted a finish on the week that was to be near-unchanged to higher Vs the previous week’s finish, which proved to be correct. Dec has commenced the new week notably higher.
• Fed Held Interest Rates Steady at September Meeting • A Net Total of 105,400 Upland Bales and 800 Pima Bales were Sold for the Week Ending September 14 • Above Average Temperatures and Precipitation Expected in the Week Ahead
Market Movement from 18th Sep 2023 to 23rd Sep 2023.
• NY Dec futures traded at 86.44 on 15-Sep, dipped to 85.91 on 22-Sep, resulting in a week-over-week loss of 0.53 cents. NY December trading market exhibited a relatively tight trading range, fluctuating between 85.5 cents and 88.5 cents.
Certificated stocks continue to flock to the Board, implying that the best market for U.S. cotton is delivery against the New York ICE futures contract. More troubling for those wishing – and hoping – for higher prices is that futures prices above 87 cents are better than the price offered by mills.
We entered last week expecting a great deal of market volatility as a host of fundamental and macroeconomic reports were scheduled for release. So it was, after advancing over 200 points ahead of the September WASDE it fell prey to the old buy the rumor, sell the fact idiom. Thus, giving back nearly all these gains to close Friday at 86.44, for a paltry gain of 53 points on the week.
Market Movement from 11th Sep 2023 to 16th Sep 2023.
• NY Dec cotton futures saw a weekly gain, rising from 85.91 cents on September 8th to 86.44 cents on September 15th, marking an increase of 0.53 cents.
DECEMBER FUTURES TRADED HIGHER FOR THE MAJORITY OF THE WEEK
• Strong Economic Data Has Many Betting Another Pause in Interest Rates Will Occur • U.S. Production Cut to 13.13 million Bales • Demand for U.S. Cotton Remains Tepid • Only 29% of the Cotton Crop in the U.S. is Rated Good to Excellent
Stagnant Demand Continues to Suppress Cotton Market
Sep 15, 2023
Certificated stocks are coming to the Board. So what? Who cares?
Better care!!
It means that someone believes the best market for cotton is the futures market delivery mechanism. If delivery against futures is the best market for stocks, then it means the cash market does not want/need cotton. Of significant importance is that stocks are being moved to a privately-owned warehouse as opposed to a merchant/cooperative warehouse.
COTTON: The 2023/24 U.S. cotton projections include higher beginning stocks but lower production, exports, and ending stocks. Beginning stocks are increased 550,000 bales, largely reflecting ending stocks data for the previous year from the Agricultural Marketing Service and the NASS Cotton System Consumption and Stocks report.
DECEMBER FUTURES REACHED HIGHEST LEVEL IN A YEAR BEFORE TURNING LOWER TO FINISH THE WEEK
• Crude Oil Prices Reached Highest Level in 2023 • Delayed U.S. Export Sales Report Held Higher than Expected Demand for U.S. Cotton • Crop Conditions Basically Unchanged from Week Prior
Market Movement from 04th Sep 2023 to 09th Sep 2023.
• It was a turbulent week in NY future. NY December surrendered all the gains from the previous week. China's increase in auction quantity has led to a sharp decline in the Chinese futures market, ZCE. Some farmers, engaged in price-fixing, and improved crop conditions have once again pushed prices below the 85 cents range, ultimately closing at 85.91 cents, resulting in a significant weekly loss of 404 points.
Keep An Eye on Cotton Prices and USDA September Report
Sep 08, 2023
December cotton futures lost all of last week’s price gains and then some, falling below 85 cents before correcting and positioning itself before making a run to the upper end of the trading range. Speculators were credited with the prior week’s run up and their associated profit taking, and the continuation of poor demand and weak economic indicators led the retreat to the 85-cent level.
COTTON MARKET AGAIN FINISHES WEEK WITH STRONG GAINS
Sep 05, 2023
The market gained 264 points last week, finishing at 89.95, with the Dec – Mar inversion expanding modestly to 18. Last week, our models predicted a finish on the week that was to be near-unchanged to higher Vs the previous week’s finish, which proved to be correct. Dec has commenced the abbreviated week significantly lower.
Last week was a case of bad news for some was good news to others. Hurricane Idalia was expected to take her Category 3 winds east of all but a small portion of the Georgia crop. Instead, upon landfall it veered slightly northward damaging a much larger expanse of the state’s crop. While abroad, China’s economy has slumped to the point its government announced Friday monetary policies would be instituted in an effort to bolster it.
Market Movement from 28th Aug 2023 to 02nd Sep 2023.
• "New York Cotton Futures for December demonstrated robust performance, increasing from 87.31 cents on August 25th to 89.95 cents on September 1st, resulting in a significant week-over-week gain of 2.64 cents. Furthermore, the month of August witnessed a notable upward trend, with prices rising from 84.72 cents on July 31st to 87.82 cents on August 31st, indicating a substantial month-over-month gain of 3.10 cents."
I was wrong. Again. Last week’s price rally was no tease. This week’s news was real, and particularly good news at that. Cotton had a monumental week, shooting up to 90 cents, basis December and settling at 89.95, the best move in nearly a year. The August USDA world supply demand report set the stage for a price rally into the low 90’s but anemic demand had blocked prices from moving higher.
• During the August, the NY December Futures attempted multiple times to break out above the 88 cents level, but each attempt proved unsuccessful. The NY futures remained confined within a narrow range of 83 to 88 cents.
• The WASDE report delivered a bullish outlook as the U.S. Department of Agriculture (USDA) lowered the U.S. crop by 2.5 million bales. This bullish sentiment from the WASDE report initially pushed the NY futures toward the upper boundary of the established range.
DECEMBER FUTURES FINISHED AUGUST IN THE UPPER END OF RANGE
• Outside Markets Higher Much of the Week Despite Unclear Economic Outlook • U.S. Export Sales Higher for Week Ending August 31, but Demand is Still a Concern • Damage to Crop from Hurricane Idalia Will Likely Be Minimal
The Big Tease – cotton prices shot higher on the week. Each successive daily close was higher than the prior day’s close. That folks, is the definition of an uptrend. Let’s get excited.
Too, the market captured the prior week’s losses. Sounds bullish – whatever that word means.
Market Movement from 21st Aug 2023 to 26th Aug 2023.
• New York December cotton futures recorded a value of 83.62 on August 18, which then rose to 87.31 on August 25, resulting in a weekly loss of 3.69 cents.
DECEMBER FUTURES MADE MODEST GAINS FOR THE WEEK ENDING AUGUST 24
• Equity Markets had a Mixed Week Before Eventually Settling Lower • Demand for U.S. Cotton Dismal for Week Ending August 18 • Deteriorating Crop Condition Continues to Worry Traders
The market (Mar) lost 427 points last week, finishing at 83.62, with the Dec – Mar spread near flat at 7. Last week, our models predicted a finish on the week that was to be near-unchanged to higher Vs the previous week’s finish, which proved to be incorrect. The Dec contract experienced only one day of non-negative action last week with its 1-point gain on Friday. Dec has commenced the new week higher.
Market Movement from 14th Aug 2023 to 19th Aug 2023.
• NY Dec cotton futures exhibited a downward trend, starting at 87.89 cents on 11-August, dipping to 83.62 cents by 18-August, resulting in a weekly loss of 4.27 cents.
THE COTTON MARKET RELINQUISHED GAINS FROM LAST WEEK’S WASDE REPORT
• Equity Markets Struggled with Mixed Economic Data • Surprising Demand from China Found on U.S. Export Sales Report for the Week Ending August 10 • U.S. Crop Continues to Deteriorate, Stemming from the Southwest
COTTON: In this month’s 2023/24 U.S. cotton projections, beginning stocks are larger, and a 2.5- million-bale decrease in production results in lower exports, domestic use, and ending stocks. Beginning stocks are larger as this month’s 2022/23 ending stocks are increased 450,000 bales reflecting slightly lower exports and July 29 warehouse inventory levels in the AMS Bales Made Available for Shipment report.
December futures string of daily highs ended last week at eight. But not before reaching 88.39 which proved to be a trigger point for grower selling. However, as warned, when riding a wave of spec buying in a market environment with questionable underpinnings a reversal is always lurking. Such was the case on Thursday, when a triple digit selloff all but erased earlier gains. The tipping point being an overbought position, pressure from grower selling, and bleak exports sales.
• NY July Future expired on 8th July, and now the front month is December. NY December new crop future stayed within a narrow range for the first 18 days but then started to trend upwards after the 18th July. Some short covering and speculative buying pulled the market to a new high of 87.90, but it eventually settled near the mid-eighties.
Gujcot Third Quarterly Rate Movement Report – 2022-23
• During the third quarter of the cotton season (April to June) NY July future remained within a range of 77 to 87 cents, while December future remained within a narrow range of 77 to 84.
• The NY Future market attempted to break out of these ranges multiple times but was unable to sustain those breakouts. This suggests that there may have been various attempts to push the market beyond these established price levels, but the momentum was not strong enough to sustain the price movement outside of the given ranges.
The cotton market was somewhat higher Monday, inspired by adverse weather unfolding across the Belt, as well as continued supporters from Friday's acres report.
The cotton market was somewhat higher Monday, inspired by adverse weather unfolding across the Belt, as well as continued supporters from Friday's acres report.
• During the month of May, NY July cotton future have not been able to break out of the long-term range of 79-86. The latest WASDE report was somewhat favorable for the market, with an increase in U.S. exports and a decrease in ending stocks. Export sales have been decent, leading the U.S. Department of Agriculture (USDA) to raise the US export estimate from 12.2 to 12.6 million bales.
Cotton’s Slow Period Continues... But Planting Decisions Are Coming Soon
With the current season coming to a close it is time to start shifting our focus to the next season with high hopes and anticipation. Most of the Northern Hemisphere cotton producing countries have started planting, are preparing for planting, or are thinking about planting. Soil moisture is an essential ingredient for a successful planting operation.
Cotlook’s May supply and demand forecasts indicate lower consumption and higher world ending stocks for both 2022/23 and 2023/24
Cotlook’s forecast of global raw cotton output in 2022/23 has been reduced this month, by 69,000 tonnes to 24,852,000 tonnes. Reductions for the African Franc Zone and the United States were partially offset by increases for China and Australia.
Since plummeting to the low 70s last fall, new crop December 2023 futures roller-coastered up, then down, then up again to near 86 cents by the end of January. December 2023 has since teetered within a five-cent range of mostly 79 to 84 cents over the past five months.
• The first half of the month saw a narrow range of 80 to 85 cents for NY futures, but the second half was bearish with a range of 76.5 to 81 cents. USDA released the WASDE report, which was nearly neutral and did not cause any significant volatility.
Cotton prices surged higher going into the three-day weekend as the Easter holiday gave speculators reason to try the long side of the cotton market once again. In fact, all contracts out to March 2024 settled above 83 cents – a welcome relief not seen in recent weeks.
Gujcot Second Quarterly Rate Movement Report – 2022-23
• Team Gujcot wishing happy and earning new financial year to all cotton friends.
• January-March quarter was volatile in all futures. Huge ups and downs were noticed during this period. Despite huge ups and downs range is very narrow. NY March was in 80.25 to 87.00 range while NY May moved in slightly bigger range of 76.54 to 88.02.
Indian Farmers Might Be Holding Their Cotton but Global Production Remains Stable
In this edition of Cotton This Month, we will examine the current situation with delayed cotton arrivals in India and how this may affect the global balance sheets in the 2022/23 season.
All cotton planted area for 2023 is estimated at 11.3 million acres, down 18 percent from last year. Upland area is estimated at 11.1 million acres, down 18 percent from 2022. American Pima area is estimated at 154,000 acres, down 16 percent from 2022.
COTTON: The 2022/23 U.S. cotton supply and demand forecasts show slightly lower mill use and higher ending stocks relative to last month, while production and exports are unchanged. The mill use forecast is lowered 100,000 bales to 2.1 million on recent lower rates of monthly utilization. The upland cotton marketing year average price received by producers is projected at 83 cents per pound, unchanged from January.
Cotton set for best week in over 2 – months on strong export sales data
ICE cotton futures rose 3% on Friday and were headed for their best week in more than two months, supported by strong U.S. export numbers and on hopes of an uptick in demand from top consumer China.
COTTON: This month’s U.S. 2022/23 cotton forecasts include higher production and ending stocks, no change in U.S. mill use, and lower exports. Production is 438,000 bales higher, at 14.7 million, with yield at a record 947 pounds per acre, up 9 percent from the December estimate. Exports are forecast 250,000 bales lower, at 12.0 million, with both projected world trade and the U.S. share slightly lower this month. Ending stocks are up 700,000 bales to 4.2 million, equal to 30 percent of projected use.
Gujcot FIrst Quarterly Rate Movement Report – 2022-23
• Team Gujcot wishes happy, healthy and earning new year 2023 to all our friends.
• Year 2022 taught us many lessons. We witnessed extremely high rates. NY cotton future near 158 cents per lb. and Indian physical cotton rate crossed Rs one lakh per candy. Some sweet and some bitter memories of year 2022. first quarter of the Indian new cotton season and second quarter of US new cotton season was dominated by bears.
This month’s 2022/23 U.S. cotton forecasts include higher production and ending stocks but lower mill use and exports. Production is 211,000 bales higher—at 14.2 million bales—mainly due to higher yields in the Delta and Southeast. Mill use is lowered 100,000 bales reflecting reduced spinning levels to date and weaker expectations for future demand. A reduction in expected world demand and trade results in a 250,000-bale decrease for U.S. cotton exports, down to 12.25 million.
• November month started with sharp uptrend during the first week. NY Future closed limit up for the first four days in this month and jumped to 87 cents from 72 cents in just one week. There after remained highly volatility during the month.
The lack of demand is clearly a problem at the moment and as such the WASDE doesn’t reflect the right set of numbers in its balance sheet. While the supply side is now more or less known, the demand side is overstated by several million bales and will have to be adjusted lower over the coming months, which will have a bearish impact.
• October was month of continuous down trend. NY December future lost about 1300 points during the month. USDA WASDE was bearish. USDA reduced world consumption by 3 million bales so world ending stock was also up by 3 million bales. Recession fear in Europe and America has created downward sentiment.
• US Export sales was poor also some cancellation from China reason for downtrend. But US is well committed to reach USDA export target.
Cotton season 2021/22 was a very challenging one. Cotton market opened at its historically high level and climbed up to create a new historical high of Rs.100,000 plus per candy. Hence it proved that is very difficult for even experts to predict top and bottom of the cotton market. Market finds its own level.
Gujcot FIrst Quarterly Rate Movement Report – 2021-22
• Up trend in cotton prices during first quarter of new season has continued with cotton prices touching life time new high in Indian cotton. While in U.S. It is the second highest rate after 2011.
• Indian Mills earned well during first quarter with old crop CCI stock till October and new arrivals.
Uncertainty and panic over the OMICRON variant caused the cotton market, along with many other commodities, to drop significantly in price over the past 2 weeks.
Production, Consumption and Trade are Expected to Increase in 2021/22
For the current season, the global production estimate for 2020/21 has been reduced to 24.3 million tonnes this month with smaller crop estimates expected for India, Brazil, and the United States. For India, the latest meeting of the Committee on Cotton Production and Consumption (COCPC) reported production for 2020/21 at 6.12 million tonnes. With the country under crisis from a second wave of COVID-19, mill-use has been revised down to 5.15 million tonnes.
Procurement operations of seed cotton (Kapas) under MSP are going on smoothly in the States of Punjab, Haryana, Rajasthan, Madhya Pradesh, Maharashtra, Gujarat, Telangana, Andhra Pradesh, Odisha and Karnataka. Till 23.03.2021 a quantity of 91,86,803 cotton bales valuing Rs.26,719.51 Crore has been procured benefitting 18,86,498 farmers.
All international benchmark prices increased over the past month.
The NY December futures contract climbed from 67 to as high as 72 cents/lb near the end of October. More recently, prices eased back to 70 cents/lb. Cotlook’s A Index rose from 73 to 76 cents/lb over the past month.
Changes in Supply and Demand Estimates (from 17 August 2020)
Limited Cotton Recovery within Pandemic: Production and Stock Levels High, Slow Consumption Growth
Even as the most stringent containment measures begin to be lifted, the opportunity for economic recovery may not relieve current market uncertainty. Countries vary in their ability to flatten the contagion curve and the fiscal space to mitigate the pandemic associated recession.
Movement in benchmark prices was mixed over the past month.
The NY December futures contract moved lower (to below 60 cents/lb in late July) and then higher (near 65 cents/lb in early August) over the past month. Current values (63 cents/lb) are nearly even with those from one month ago.
A cyclonic circulation is over East Uttar Pradesh and adjoining area. Another cyclonic circulation is over Central Pakistan. A trough is extending from central Pakistan to Bangladesh across Rajasthan, South Uttar Pradesh, Jharkhand and West Bengal in lower levels. A cyclonic circulation is over central parts of Assam. A cyclonic circulation is over south Konkan. A shear zone is extending from this cyclonic circulation to Chhattisgarh across North Interior Karnataka and Telangana.
U.S. producers will plant 13 million acres in 2020
U.S. cotton producers intend to plant 13 million cotton acres this spring, down 5.5% from 2019 (based on the U.S. Department of Agriculture’s February 2020 estimate), according to the National Cotton Council’s 39th Annual Early Season Planting Intentions Survey.
Cotton Inc. Executive Cotton Update - February 2020
Executive Cotton Update - February 2020
Macroeconomic Overview: The Bureau of Economic Analysis estimates that the U.S. economy grew 2.3% in 2019. Forecasts suggest that growth could slow a little in 2020, with many projections falling between 1.9% and 2.1%. For comparison, in 2018, growth was 2.9% and in 2017 growth was 2.4%.
Highlights from the Inaugural Session of the 78th Plenary Meeting:
Consumers today are increasingly demanding information on the origin and history of the products they buy, putting pressure on retailers to provide transparency
Multiple technologies have the potential to provide that traceability, including blockchain and a host of products from private companies
Gujarat cotton crop is estimated as 1,06,94,302 Bales out of which 2,75,000 Bales will be of V-797 rest will be Shankar-6. Gujarat cotton crop yield is expected to rise by 32.97% and crop is expected to increase by 30.83%
we estimate total Gujarat cotton pressing to be 120-125 Lakh Bales of 170 Kg.
The Season 2018 -2019 started with bullish sentiment in India. Indian cotton crop was predicted 343 lakh bales at the start of the season against 365 to 375 lakh bales of season 2017-2018. Opening stock was low and mills requirement of new cotton was high. With bull sentiment season touched double top at 47,150 on 15th October at the start of the season.
The latest U.S. Department of Agriculture (USDA) estimates indicate that total U.S. cotton textile and apparel trade rose during the first half of 2019, compared with the corresponding 2018 period. U.S. cotton product imports totaled the equivalent of 9.0 million 480-pound bales of raw cotton during January-June 2019—compared with 8.8 million bales for the first 6 months of 2018—while cotton product exports declined slightly to 1.7 million bale-equivalents.
Cotton Textile exports reached a level of USD 739.17 million in June 2019 marking a decline of (-) 30.4 per cent against the corresponding month of June 2018, wherein exports were valued at USD 1,061.96 million.
In rupee terms, exports during the month of June 2019 reached a level of Rs. 5,132.72 cr. as against Rs. 7,199.39 Cr. in June 2018 marking a decline of (-) 28.7 per cent in rupee terms.
China cotton imports in 2019/20 are expected to surpass the previous year’s robust level, reinforcing its position as the world’s largest importer. The current 2018/19 estimate, boosted this month, is expected to be the largest in 5 years as China supplements domestic supplies amid ongoing auctions of State Reserve stocks. Despite this strong upward trend in imports, U.S. exports to China have weakened as Brazil, Australia, and other countries have expanded both exports and market share.
While corn remains the major safrinha crop for Brazilian farmers, more cotton acreage is being planted in Mato Grosso this spring, as well.
Over the past two years, cotton planting has increased by nearly one-third for the safrinha in Mato Grosso. The Brazilian Association of Cotton Producers(Abrapa) forecast cotton acreage to grow to 1.4 million hectares (3.46 million acres). Mato Grosso accounts for about 88% of Brazil’s cotton production.
Historical Revisions to Indian's Cotton Balance Sheet - USDA
Historical Revisions to Indian's Cotton Balance Sheet - USDA
Historical revisions have been made to India’s balance sheet for the years 2002/03 through 2013/14, with the stock adjustment carried forward. The revisions are based on the conclusion that market yard arrivals data underreported arrivals in the early portion of the harvest season. This conclusion was based on observed market activity in November for several years.