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DTN Closing Cotton 12/12 13:38
Cotton Lacks Strength
After flirting with holding on to earlier upside gains, the cotton market
ended lower today.
Keith Brown
DTN Contributing Cotton Analyst
After flirting with holding on to earlier upside gains, the cotton market
ended lower today. Traders had thought a weaker U.S. dollar, short-covering
bearish funds, and wildly higher financials might boost the ICE futures, but
the market settled down on the week some 10 points. Next week, traders will see
retail sales, additional CFTC updates and back-logged export sales data.
Regarding export sales, we note that cumulative sales for 2025/2026 have
reached 5.44 million bales, down from 6.05 million bales at this time last
year. Sales are hovering at 11-year lows. In percentages, U.S. sales have
reached 49% of USDA's current season forecast, which is below the five-year
average of 65% for this point in the marketing year.
As mentioned, the CFTC will release yet another back-logged Commitment of
Traders report today. The most recent release had the managed-money funds
buying back 3,453 positions, reducing their overall net-bearish carry to 60,329
contracts. The agency's goal is to have all delayed data out by the end of
December.
Crude oil eased lower today. In fact, the "black liquid" is on track for a
weekly decline. Traders are concerned about a supply glut and potential
Russia-Ukraine peace deal. Other price-supportive factors include the tensions
between the U.S. and Venezuela and Ukrainian drone strikes on a Russian oil rig
in the Caspian Sea.
For Friday, March 2026 went out at 63.83 cents, minus 14 points; July was
65.94 cents, down 13 points; and December 2026 halted at 67.53 cents, off 8
points lower. Friday's estimated volume was 30,527 contracts.
Keith Brown can be reached at commodityconsults@gmail.com
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