DTN Closing Cotton            04/10 13:34

   Cotton Market Hangs Tough

   Despite its recent five-week upsurge, the cotton market held on to its gains 
today.

Keith Brown
DTN Contributing Cotton Analyst

   Despite its recent five-week upsurge, the cotton market held on to its gains 
today. With talks in Pakistan between the U.S. and Iran, there was little 
geopolitical news to drive prices one way or the other.

   This morning CPI (consumer price index) showed a seasonally adjusted 
increase for March of 0.9%. That number put the annual inflation rate at 3.3%. 
However, core prices were less at just 0.2% for the month and 2.6% from a year 
ago. The Iran conflict was the driver for the monthly inflation reading, as 
gasoline soared 21.2%, accounting for nearly three-quarters of the headline 
price increase.

   The weekly U.S. Drought Monitor showed some 95% of the U.S. cotton area in 
some form of drought. Specifically, Texas stands at 97%. The U.S. Climate 
Prediction Center has given El Nino a 61% chance of developing between May and 
June persisting through at least the end of the year. The 6- to 10-day and 8- 
to 14-day forecast shows above-normal chances of rain through April 23. The 1- 
to 5-day outlook has a possible 1.5 inches for west Texas.

   Today at 3:30 p.m. EDT, the CFTC will update its Commitment of Traders data. 
Last week saw the managed-money funds had net bought some 21,000 positions, 
reducing their net-short carry to some 12,000 contracts.

   Some traders and analysts are saying that the fate of the global economy 
hinges on the outcome of make-or-break talks between the U.S. and Iran this 
weekend in Pakistan. The streets of the capital, Islamabad, have been emptied 
by a sudden two-day public holiday declared to enforce strict security for the 
arrival of the American and Iranian delegations for their first talks since the 
beginning of the war. A fragile two-week ceasefire that paved the way for the 
talks is holding for now. But Israel's massive deadly bombardment of Hezbollah 
and disagreements over whether Lebanon is included in the truce, could still 
upend the ceasefire.

   For Friday, July closed at 75.33 cents, up 1 point; December 2026 closed at 
76.89 cents, plus 2 points; and March 2027 finished at 77.67 cents, 5 points 
higher. Friday's estimated volume was 115,202 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com




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