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DTN Closing Cotton 07/02 13:34
Cotton Stymied by Exports
The cotton market lost its positive grip and grit Thursday after weekly
export sales underperformed. Also impeding prices was the slow holiday volume.
Keith Brown
DTN Contributing Cotton Analyst
The cotton market lost its positive grip and grit Thursday after weekly
export sales underperformed. Also impeding prices was the slow holiday volume.
Highlights from Thursday's USDA cotton export sales included net sales of
49,001 bales for the current marketing year and net sales of 44,117 for 2026-27
for a total of 93,118. That amount was well below the 150,953 total of last
week and the lowest since May 7. Cumulative sales for 2025-26 have reached 105%
of the USDA forecast versus a five-year average of 113% for this point in the
marketing year. Weekly Shipments totaled 218,753 bales, down from 300,155 for
last week.
The 6- to 10-day weather forecast (July 7-July 11) shows above-normal
temperatures for Texas, but much-above normal readings for the Delta and the
Southeast. Rain-wise, Texas looks to have slight chances, while the Southeast
and the Delta should see better-than-normal opportunities. The U.S. Drought
Monitor currently shows 56% of the U.S. Cotton Belt remains in drought versus
last week's reading of 58%. For context, the highest peak reading was 98%
drought.
The U.S. dollar fell sharply Thursday after the June employment report
showed fewer jobs than expected were added. U.S. employers added 57,000 jobs --
well below expectations for 110,000 job gains. Unemployment slipped to 4.2%,
from 4.3%. The financial markets quickly repriced their expectations for
Federal Reserve policy. The Fed Funds futures now place a 53% chance of a
rate hike by September, down from 67% before the report.
The cotton market will be closed Friday in observance of Independence Day,
America's 250th. Trading will resume on Monday at 8 a.m. EDT.
For Thursday, July closed at 72.57 cents, off 71 points; December closed at
77.12 cents, minus 72 points; and March 2027 finished at 78.52 cents, down 67
points. Thursday's estimated volume was 29,623 contracts.
Keith Brown can be reached at commodityconsults@gmail.com
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