Prospective production on the Texas High and Rolling Plains rose by 305,000 bales from a month ago, accounting for the bulk of the 500,000-bale jump in the statewide crop.
Cotton futures finished on modest gains of 27 to 35 points Tuesday, led for a second day by spot March on a 14-session high close.
March settled at 72.04 cents, above highs of the prior seven sessions and in the upper third of the day’s 124-point range from up 74 points at 72.43 cents to down 50 points at 71.19 cents. It recovered from a morning swoon to post its highest close since Nov. 22.
The May contract gained 30 points to close at 72.20 cents, while December 2017 added 29 points to finish at 69.89 cents.
Volume increased to an estimated 26,299 lots from 22,456 lots the prior session when spreads accounted for 3,733 lots or 38%. Options volume totaled 3,733 calls and 3,415 puts.
Prospective cotton production on the Texas High and Rolling Plains rose by a combined 305,000 bales from a month ago to 5.69 million, accounting for the bulk of the 500,000-bale jump to 7.4 million in USDA’s December estimate of the statewide crop.
Production on the High Plains gained 295,000 bales to 4.67 million, up 23% from last year’s 3.798 million and the largest since 2010 when the region harvested 5.331 million bales, its third largest crop ever. That’s 63% of the statewide crop and 30% of the U.S. upland output.
Yields climbed to an average of 656 pounds per acre from 615 pounds foreseen a month ago and 632 pounds last season. There was talk that anecdotal evidence indicated yields still may be understated.
Abandonment remains estimated at 310,000 acres or 8.3% off plantings of 3.725 million acres, up from 3.113 million acres seeded in 2015.
The Rolling Plains is expected to harvest 1.02 million bales, up 10,000 bales on the month and from 951,000 bales harvested last year.
In other districts, crop estimates on the month were steady at 260,000 bales in the Edwards Plateau and rose by 6,000 bales to 115,000 in the Blacklands, 4,000 bales to 70,000 in South Central, 97,000 bales to 592,000 in the Coastal bend, 40,000 to 200,000 in the Upper Coast, 7,000 bales to 292,000 in the Lower Rio Grande Valley and 41,000 bales to 181,000 elsewhere.
The Texas crop, up 29% from last year, also is the largest since 2010 when growers harvested 7.84 million upland bales. Yields are expected to average 670 pounds per acre, up from 610 pounds last year and the largest since 703 pounds in 2010 and the five-year average of 624 pounds.
The statewide average yield has declined from 716 pounds in 2010, prior to the historic drought of 2011. Producers on the High Plains, the state’s major irrigation area, couldn’t keep up with crop demands for water during the 2011 drought and subsequently cut the irrigated portion of their cotton acres.
Acres for harvest are estimated at 5.3 million, up 18% from last year. This is from plantings of 5.7 million acres, reflecting an abandonment of 7%.
Futures open interest increased 939 lots Monday to 250,969, with March’s up 317 lots to 176,621 and May’s up 218 lots to 40,275. Cert stocks grew 3,012 bales to 77,552. There were 4,208 newly certified bales and 1,196 bales decertified. Awaiting review were 3,684 bales at Greenville, S.C.