| |
DTN Morning Cotton Commentary 07/21 07:17
Cotton Trying to Bounce Back
After posting a sharp retreat in prices Monday, the cotton market is trying
to gnaw away at the 80-cent mark Tuesday.
Keith Brown
DTN Contributing Cotton Analyst
After posting a sharp retreat in prices Monday, the cotton market is trying
to gnaw away at the 80-cent mark Tuesday. Traders remain wary of certain
growing conditions across the Northern Hemisphere. Later in the week, traders
will see another round of export sales. Meanwhile, the funds continue to hold a
decent bullish position.
USDA released its weekly Crop Progress report Monday. Its data showed 45% of
the U.S. crop was rated good to excellent as of July 19. That reading is up
from the 44% number of last week, but down from 57% a year ago. The five-year
average for this date is 50%. Texas was 30% good to excellent, unchanged from
last week but down from 51% a year ago and below the five-year average at 38%.
Mississippi was 47% good to excellent, up from 39% last week and the same as
47% a year ago. The five-year average is 60%. The 2026 crop is progressing at
a normal pace, with 32% of the U.S. crop setting bolls, unchanged from a year
ago and the five-year average.
On Thursday, USDA will issue its weekly export sales report. Last week's
business was bearish in that net sales for the current season were 34,000
bales, a marketing-year-low effort. Weekly shipments were 214,900 bales off 7%.
This Friday, the Commerce Department will release its New Home Sales data at
10 a.m. EDT. This report, along with the Housing Starts Report, play key roles
in domestic consumption of cotton products.
Also on Friday at 3:30 p.m. EDT, the CFTC will update its Commitments of
Traders information. Last week saw the managed-money funds buying in some
10,500 positions, further enhancing their net-long carry to 49,688 contracts.
The U.S. dollar is pushing on a one-week high, as traders concerned with
increased hostilities in the Middle East are seeking financial refuge. There
are ideas a new ten-day ceasefire may be in the works with the memorandum of
understanding possibly put back on the table. However, Yemen's Iran-aligned
Houthis declared a naval blockade on Saudi Arabia, raising the threat to global
energy supplies.
Chart support for December cotton stands at 78.50 cents and 77.75 cents,
with resistance around 80.25 cents and 81.75 cents. Tuesday morning's estimated
volume is 6,209 contracts.
Keith Brown can be reached at commodityconsults@gmail.com or by calling
(229) 890-7780.
(c) Copyright 2026 DTN, LLC. All rights reserved.
Get your local Cash Bids emailed to you each morning from DTN – click here to sign up for DTN Snapshot.
|
|
