DTN Closing Cotton            07/30 13:46

   Cotton Flip-Flops Again Thursday

   The cotton market was triple digits higher Thursday, even pressing on the 
81.00-cent mark. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market was triple digits higher Thursday, even pressing on the 
81.00-cent mark. The ICE futures were supported by a weaker U.S. dollar, a 
stronger Dow Jones, and much improved export sales.

   Highlights from Thursday's weekly export sales report included net sales of 
29,719 bales for the soon expiring 2025-26 year and 352,447 for 2026-27. The 
combined total was 382,166, up from 67,433 the previous week, and the highest 
since June 4. At that time, combined seasonal sales were 505,721 bales. 
Cumulative sales 107% of USDA's forecast versus a five-year average of 114% for 
this point in the marketing year.

   Friday CFTC updated its Commitments of Traders data. The results showed 
managed-money funds bought some 3,500 futures, further swelling their net-long 
position to 53,209 contracts.

   A major weather outlet now says the U.S. Southern Plains and a part of the 
Delta will be drying out over the next ten days. Hot temperatures and limited 
rainfall in West Texas will stress crops and raise the potential for lower 
production. Crop stress will be greatest in the drier areas of the central and 
north initially. In Xinjiang, China, the largest production province, weather 
conditions will turn hot again during the first week to ten days of August. If 
it lingers beyond, it may begin a more serious bout of crop stress that could 
harm production more than the recent short episodes of heat seen in early July 
and last week.

   The 6- to 10-day weather forecast (Aug. 4-8) shows much-above normal 
temperatures of varying degrees, for the length and breadth of the U.S. Cotton 
Belt. Rain-wise, West Texas should see nearly-normal changes, while the lower 
Delta and the Southeast may anticipate slightly-above normal  opportunities.

   For Thursday, December closed at 80.67 cents, plus 114 points; March 2027 
finished at 82.25 cents, up 111; and July 2027 settled at 82.96 cents, up 80 
points. Thursday's estimated volume was 38,347 contracts.

    

   Keith Brown can be reached at commodityconsults@gmail.com




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