Cotton Prices Dip Amid Mixed Market Signals
Futures for cotton experienced a decline on Friday, with losses ranging from 62 to 67 points. Factors influencing the market are varied; while the US dollar index rose by 451 points, crude oil prices increased by $2.32 per barrel. Much of the market’s attention centers on negative data released by the USDA earlier today.
USDA Reports Record Cotton Ginnings
The latest Cotton Ginnings report disclosed that 1.626 million running bales (RB) of cotton were ginned during the last fortnight of December. This brings the total for the season to 13.051 million RB, marking the highest figure in three years and reflecting an 18% increase from the previous year.
Changes to Production and Export Projections
The USDA revised its cotton production estimate upward by 150,000 bales, now at 14.41 million. This adjustment comes alongside a yield increase of 44 pounds per acre, while harvested acres were slightly reduced by 360,000 to a total of 8.27 million. In conjunction with a 300,000 bale cut to export targets, USDA revised its carryout projection by 400,000 bales, setting it at 4.8 million.
Export Sales Show Modest Improvement
The weekly Export Sales report issued today revealed 137,382 RB of upland cotton sales for the 2024/25 marketing year, marking a 6.61% increase compared to last week. Notably, Turkey purchased 62,000 RB, while Pakistan accounted for 25,500 RB. Shipments reached a marketing-year high, totaling 191,672 RB. Vietnam emerged as the top recipient with 45,400 RB, and China followed with 43,800 RB.
Market Statistics and Prices
As of January 9, The Seam recorded 9,935 bales of online sales, averaging 64.75 cents per pound. Meanwhile, ICE cotton stocks held steady at 20,113 bales of certified stocks as of Thursday. The Cotlook A Index for cotton decreased by 25 points on January 9, resting at 78.70 cents per pound. The USDA’s Adjusted World Price (AWP) also saw a decline, down 37 points from the previous week to settle at 54.66 cents per pound.
Current Futures Pricing
Mar 25 Cotton is priced at 67.88¢, down 62 points.
May 25 Cotton is priced at 69.06¢, down 62 points.
Jul 25 Cotton is priced at 70.08¢, down 67 points.
On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data are solely for informational purposes. For more details, please view the Barchart Disclosure Policy
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