DTN Morning Cotton Commentary          06/24 08:11

   Cotton Wobbles Unchanged/Higher

   Overnight, the cotton market spiked to even lower lows, but has eased back 
to slightly positive levels.

Keith Brown
DTN Contributing Cotton Analyst

   Overnight, the cotton market spiked to even lower lows, but has eased back 
to slightly positive levels. Still, from last Friday's close, the market is off 
some 2,000 points, and the charts look bearish.

   There were no deliveries against the July contract. It still shows an open 
interest of 5,900 contracts, but at the time of this writing is being offered 
some 1400 points lower at 117.35.

   USDA issued its delayed weekly export sales. That data is as follows: Net 
sales of 16,200 RB for 2021/2022--a marketing-year low--were down 39 percent 
from the previous week and 90 percent from the prior 4-week average.  Increases 
primarily for Vietnam (6,300 RB, including 3,700 RB switched from South Korea 
and decreases of 2,200 RB), China (4,500 RB, including decreases of 200 RB), 
Mexico (2,800 RB), Thailand (2,400 RB, including 200 RB switched from Japan), 
and India (2,200 RB), were offset by reductions primarily for South Korea 
(3,700 RB) and Pakistan (1,600 RB).  Net sales of 277,300 RB for 2022/2023 were 
primarily for China (238,100 RB) and Mexico (32,600 RB).  Exports of 371,900 RB 
were up 11 percent from the previous week and 1 percent from the prior 4-week 
average.  The destinations were primarily to China (117,200 RB), Turkey (83,800 
RB), Vietnam (50,800 RB), Pakistan (23,300 RB), and Mexico (18,100 RB).  Net 
sales of Pima totaling 1,300 RB were up 41 percent from the previous week, but 
down 13 percent from the prior 4-week average.  Increases reported for China 
(800 RB), South Korea (300 RB), Vietnam (300 RB switched from India), Japan 
(100) RB), and Mexico (100 RB), were offset by reductions for India (300 RB).  
Exports of 5,600 RB were down 15 percent from the previous week and 41 percent 
from the prior 4-week average.  The destinations were primarily to China (2,200 
RB), Pakistan (1,000 RB), Thailand (900 RB), India (600 RB), and Indonesia (400 
RB).  

   NOAA issued its weekly U.S. Drought Monitor Thursday, and it continues to 
paint a bleak picture. The report stated "extreme heat, high winds, and 
below-normal precipitation continued in Texas, leading to another round of 
degradation".

   The five-day outlook suggests spotty rains for West Texas. However, the 6 to 
10-day and the 8 to 14-day forecasts call for above-normal temperatures, but 
normal to above-normal precipitation for West Texas. There is the possibility 
for heavier rains to occur from the Texas Panhandle, stretching across the 
Delta and Southeast.

   For Friday, support for December cotton stands at 97.00 cents and 96.50 
cents, with resistance at 108.00 cents and 109.70 cents. The estimated morning 
volume is 16,697 contracts. 

   Keith Brown can be reached at commodityconsults@gmail.comor by calling (229) 
890-7780.




(c) Copyright 2022 DTN, LLC. All rights reserved.