DTN Cotton Close: Slightly Ahead Despite Poor Exports

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    Export commitments stand 3.53 million RB above year-ago bookings and are 74% of the USDA estimate. Mills’ unpriced on-call position grew 1,359 lots. Cert stocks jumped 50,169 bales. Upland cotton under loan rose to 4.96 million RB.

    Cotton futures finished slightly ahead Friday, shrugging off U.S. weekly export sales that came in a little lower than generally expected and a jump in stocks in deliverable position.

    March closed up 21 points to 73.99 cents, in the upper reaches of its 129-point range from up 41 points at 74.19 cents to down 88 points at 72.90 cents. It touched the high in the early minutes of overnight trading, slipped to the low — below the prior-day low — before midmorning and settled six ticks above where it opened Thursday night.

    May gained 36 points to close at 74.29 cents, while December eked up 10 points to settle at 71.57 cents. For the week, March advanced 334 points or 4.7%, May added 327 points and December gained 203 points.

    Volume slowed to an estimated 28,863 lots from 43,298 lots the previous session when spreads accounted for 16,812 lots or 39%, EFP 281 lots and EFS 54 lots. Options volume totaled 4,265 calls and 5,074 puts.

    Net U.S. all-cotton export sales of 186,900 running bales during the week ended Dec. 29 for shipment this season, down from 288,000 RB the previous week, brought 2016-17 commitments to 8.797 million RB.

    Upland sales of 183,700 RB, down 45% from the four-week average, went to 15 countries, led by China, India and Vietnam.

    Commitments widened the lead over year-ago bookings by 94,700 RB to 3.531 million RB or 67% and were 74% of the USDA export projection. A year ago, commitments were 59% of final 2015-16 exports.

    All-cotton shipments of 259,600 RB, down from 288,000 the week before, boosted the total for the season to 4.009 million RB, widening the lead over year-ago exports 87,000 RB to 1.57 million RB.

    Shipments were narrowly ahead of the weekly pace required to reach USDA’s export forecast after topping that average the previous week for the first time this season.

    Upland shipments of 252,400 RB, up 9% from the four-week average, went to 25 countries, headed by Vietnam, China and Indonesia.

    All-cotton exports were 34% of the USDA estimate, compared with 27% of final shipments at the corresponding point last season.

    To achieve the forecast, shipments need to average roughly 252,700 RB for the remaining 31 weeks of the season, while weekly sales averaging around 98,300 RB would match the export estimate.

    No fresh sales for shipment next season were reported. Commitments for 2017-18 remained at 564,900 RB, down from 741,200 RB in forward bookings a year ago.

    Meanwhile, mills added 1,359 lots to their total unpriced on-call position last week and producers hiked theirs 225 lots, data released by the Commodity Futures Trading Commission showed after the close Thursday.

    The unfixed positions were 110,309 lots on the mill side and 21,025 lots on the producer side, resulting in the net call difference rising 1,134 lots to 89,284, which was 36.4% of the open interest.

    On the crop scene, U.S. upland loans outstanding rose 294,776 RB to 4.96 million RB during the week ended Monday, according to the latest USDA figures. Entries were 491,790 RB and repayments were made on 197,014 RB.

    Upland cotton under loan included 508,549 RB of Form A loans issued to individual growers and 4.451 million RB of Form G loans issued to marketing cooperatives or loan servicing agents.

    Futures open interest increased 3,265 lots Thursday to 258,660, with March’s up 2,105 lots to 175,563 and May’s up 535 lots to 41,255. Cert stocks jumped 50,169 bales to 90,639. The additions included 46,476 bales at Memphis and 3,693 bales at Greenville.

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