By Keith Brown, DTN Contributing Cotton Analyst

July 27, 2021

For the first time, the December contract closed over the 90-cent mark. The settlement has been a long time coming, as the last time the new crop had such a close was June 4, 2018. That was the time of the implementation of the Trump tariffs. At any rate, some traders feel a close over 90 cents sets the technical stage for a challenge of the Trump tariff highs.

Thursday USDA will issue its weekly export sales. The expiration of the 2020-21 season will be one highlight of the report. There, traders will see the amount of sales and shipment rolled forward into the new 2021-22 crop year. However, another concern among traders is the hope that China will reemerge as a top buyer.

Of late, China has been a harsh critic of the U.S. over many situations, including slave labor charges. However, it is also thought China will expand its import quotas to offset the “tainted” cotton from the Xixiang Provence, to spin and fill orders.

The U.S. dollar lost ground Tuesday to the euro and the yen. Anticipation that the CDC will reorder the use of masked for indoor facilities is bearish to the greenback. However, the yen saw appreciation via the Tokyo Olympics. The Federal Reserve will announce its monetary policy Wednesday — no change is expected.

Tuesday, December settled 90.23 cents, up 0.63 cent, March ended at 89.81 cents, plus 0.56 cent and December 2022 ended at 81.28 cents, 0.53 cent higher; estimated volume was 24,698 contracts.