Cotton Drags Lower Thursday
Jun 22, 2023
The cotton was moderately lower Thursday.
The cotton was moderately lower Thursday. Traders were bearishly influenced by several central banks hiking their interest rates. In addition, time for spot July is winding down.
USDA will issue its weekly export sales Thursday. The report was delayed due to the observance of the Juneteenth holiday on Monday. Last week's export sales report showed net sales of 98,915 bales, versus the 483,092 bales sold the week before. Nonetheless, the market is lower now.
The immediate forecast for West Texas calls for moderate rainfall, but higher temperatures. Additionally, the six- to 10- and the eight- to 14-day outlooks both carry above-normal temperatures and below-normal chances of precipitation for that region. However, the Delta and the Southeast have been inundated with big rains.
The July Contract has been a lead weight for the market. Amazingly, there are existing growers who must still fix their 2022 cotton production, and tomorrow is the last day to make a mad dash for the exit-door. The contract goes into delivery this Monday.
Crude oil was sharply lower Thursday, as concerns over a bigger-than-expected Bank of England rate hike outweighed a surprise draw in U.S. oil supplies. Given the decline in crude oil and the very modest increases in refined product inventories, Traders were expecting a more positive response. Yet to reiterate, the energies were outweighed by higher interest rates.
Thursday, July settled at 79.29 cents, down 0.02 cent and December 2023 ended at 80.15 cents, down 0.37 cent and March was 80.29 cents, 0.41 cent lower. Estimated volume was 28,709 contracts.