Cotton Looks to Leverage Demand for Natural Fibers

They finally did it.  The Chinese enacted the most bullish scenario possible for cotton, save that of mandating every person in the country buy a new cotton shirt.  Too, for all the serious intellect and market savvy they possess, they have no idea what they did.  After much historic discussion and arm twisting the free world allowed China to join to the WTO and enjoy all the free trade rights and privileges of the somewhat tariff free world economy.  China’s only ...
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Cotton Prices Go On the Defensive

After some two months of moving to the upside cotton prices are now on the defense while attempting to hold the important 83-84 cent major support level. The next major support level would be 79 cents.  After suffering a ten cent loss as speculative funds took profits and exited the market, fundamentals are now back in the picture.  Yet, the tariff nervousness was a drag on the market, but no more so than the recent rains in Texas.  It was not important exactly where and how much ...
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Rain Brings Down Cotton Prices

The musical world told the story of cotton trading this week…low low prices and no high prices:  The lyric “It’s all about the bass, no treble” told the full story.   There was nary a high note to be heard, just all low and lower notes came out of the mouth of traders.   Trading took the market down a thin dime, a 1000 points; now we can look for some recovery and hope for a little treble.Prices sensed troubles at the prior week’s close as ...
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Cotton Prices Push Higher, A Bigger Crop Could Bring Them Down

After challenging contract price highs during the week, a combination of overbought conditions, coupled with more showers across Texas and the Southwest, trumped the market’s push to higher ground and forced all contracts except July and October below the 90 cent level. Nevertheless, the price uptrend remains in place.  However, the market is inspecting the lower end of the price range as opposed to the upper end and is working the 88 to 95 cent trading range.  Thus, the bottom e...
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Lower Stocks Drive Cotton Prices Higher

The juice continued to flow into the cotton market as new contract highs and new high closes were made during the week.  Too, it was very satisfying to the bulls as the week ended with the market holding its strength.    Most are beginning to realize that world stocks are not at the levels presumed, as well as the fact that U.S. ending stocks will be much lower, likely some 800,000 to 1.1 million bales lower than USDA estimated.  U.S. export sales have slowed as the 90 c...
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Mills Scramble to Buy Cotton Fearing Higher Prices

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...
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Declining Cotton Stockes Drive Prices Higher

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 ...
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Bull Market Pushes Cotton Prices Higher

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 ...
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Cotton Prices Dip, Despite Strong Exports

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 ...
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Cotton Prices Continue to Push Higher

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...
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