Fittingly the circus midway has come to the cotton market, “round and round and round she goes, where she stops no one knows.”   It’s a catchy theme and one that is catching more than a few textile mills as they scramble to buy into the market to complete their pricing, i.e., price fixations on the July contract.  The world cotton surplus has been resolved and once again the market is at the whims of Mother Nature.  She is holding all the new crop cards.&nbs...

Cotton bulls are roaming the globe as Chinese, Indian and U.S. cotton stocks continue to decline.   With stocks falling in the three major producing countries, world stocks are working their way down to 87 million bales, some 1.2 million below the current USDA estimate.  Too, with the USDA world stocks estimate some seven million bales overstated, prices were initially slow to move higher until the past month when virtually every analyst and the principal cotton agencies in other ...

Cotton prices took a ride on the bullet train this week as new crop futures made life of contract highs in all active months.  Granted, most are focused on the 2018 crop as would be expected. However, the 2019 December contract traded above 77 cents.  Don’t you want just a 5% or 10% slice of that pie?  Think about it and then do it.  The 2018 crop price ride is not done yet, but this may be time for a slight pause.  Supply fundamentals are now bullish so the price ...

The cotton market had a rough and tumble week as a seemingly bullish supply demand report turned sour.  Prices dipped on the week in spite of increased exports forecast by USDA as well as a lower carryover.  However, it was healthy that the market was able to reverse its downward slide and settle the week on a positive note.  The old crop July contract is expected to become volatile with just 29 more trading days before first notice day.  The likely range is from a low of 79 ...

Prices held at the upper end of the trading range most of the week and for the first time in several weeks the market traded a very narrow range.  The lack of volatility could suggest the old bull is tiring, but then, a new bull may be emerging.  Certainly the extreme drought in the Southwest continues to feed bullish hopes, but another full month of dry weather will be necessary before anything can be written off.  Yes, there are legitimate and grave concerns, but rains by the fi...

Cotton prices continue to follow the surge in exports that is being driven by worldwide demand for cotton and particularly the strong demand for U.S. cotton.  U.S. high grades have effectively been sold out as evidenced by the small level of certificated stocks and the emergence of a very strong taker of delivery notices issued on May contract.  Export demand is further boosted by the abundant supply of U.S. low grades comprised of low micronaire and barky cotton.  The demand for ...

Cotton trading turned a bit puny all week as the May futures contract moved closer to expiry and the July contract prepared to become the spot month.   Open interest in the May contract has quietly dissipated.  Thus, any expected fireworks on the May contract have been all but abated and the expiry will be silent.  Delivery notices can be issued at the conclusion of trading on Monday, April 23.   However, the July contract remains supported by the bullish on-call sa...

Cotton posted gains on the week as the old crop May and July futures contracts traded within the 82.5-84.5 cent range and closed above 83 cents.   May was impressive as it moved through the fund long roll positions (sell May/buy July) and posted gains despite the selling pressure created by rolling positions to the July contract.  In fact, the May contract is suggesting that the market is facing a price inversion (the nearby contract is higher than the next contract).  Mill d...

Cotton prices fought the battle with volatility all week, but settled higher as both the old crop May and July contracts settled above 82 cents.  The new crop December contract traded above 78 cents, but settled the week at 77.94 cents. Fundamentals remained much the same as the prior two months, very strong export sales and even stronger shipments, coupled with active on-call sales. Yet, on-call sales across all futures contracts declined during the week due to heavy fixations on the May c...

Cotton trading continues mixed, but all contracts settled higher he end of the first quarter of the year.  Earlier the nearby May and July contracts slipped below 81 cents, but finished the week challenging the 82 cent mark.  The new crop December contract clawed its way back to just below 78 cents and the week’s fundamental news purports to push the December futures contact above 78 cents, the price level we had advised to growers to begin their pricing. USDA’s annual pros...