DTN Cotton Open: Ticks to 7-Session High Overnight

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    U.S. upland export sales came in at 316,500 RB for this season and 141,700 RB for next season. Upland shipments slipped to 337,900 RB. Cash online grower sales increased to 7,388 bales on The Seam.

    Cotton futures ticked on modest gains in early dealings Thursday, remaining within the overnight range after opening flat to little changed.

    May hovered up 34 points at 78.42 cents, trading within a 71-point range from 78.08 to 78.79 cents on a contract volume of 3,535 lots. It posted a seven-session high. July gained 27 points to 79.36 cents on 1,462 lots and December eked up a point to 75.36 cents on 1,030 lots.

    Net U.S. upland export sales for shipment this season rose to 316,500 running bales during the week ended March 9, up 27% from the previous week but down 4% from the prior four-week average, USDA reported.

    Sales went to 19 countries, led by Vietnam, Turkey, India, China and Bangladesh. Gross sales were 323,500 RB and cancellations were 7,000 RB. Net upland sales for 2017-18 slowed to 141,700 RB from 215,500 RB the prior week. Leading buyers were China, Pakistan, Bangladesh and Thailand.

    Upland shipments of 337,900 RB fell 36% from the previous week and 12% from the four-week average. Shipments went to 27 countries. Leading destinations were China, Vietnam, Pakistan, Indonesia and Bangladesh.

    Net Pima sales of 74,700 RB for this season climbed 72% from the prior week and 99% from the four-week average. These were primarily for China, South Korea and Thailand. Net sales 2,500 RB for next season were reported for India.

    Shipments of the extra-long staple cotton of 8,300 RB fell 45% from the prior week and 41% from the four-week average. The main destinations were China, India, Pakistan, Peru and Germany.

    In outside markets, U.S. dollar index futures traded down 0.310 to 100.265 on the heels of the prior day’s sharp decline, while Dow Jones futures ticked up 55 points and S&P futures up 3.75 points.

    Crude oil gained 30 cents to $49.16, Brent crude added 34 cents to $52.15 and April gold advanced $31.10 to $1,231.80. May corn was up 0.6%, May soybeans 0.7%, May Chicago wheat 0.5% and May Kansas City wheat 0.7%.

    Earlier, global stock markets rose amid bullish sentiment buoyed by indications the Federal Reserve intends to maintain a measured rate of interest rate increases.

    In Asia, Japan’s Nikkei 225 gained 0.1%, Hong Kong’s Hang Seng 2.1%, China’s Shanghai Composite Index 0.8%, South Korea’s Kospi 0.7% and India’s Sensex 0.5%. In early trading in Europe, Germany’s DAX advanced 1.1% and France’s CAC 40 gained 0.6%. Britain’s FTSE 100 added 0.6.

    China’s Zhengzhou cotton futures ended on modest gains and prices were mixed on the China National Cotton Exchange. India’s MCX cotton futures were firm and local prices gained.

    Slowed buying continued in China’s auctioning of its reserve stocks. Only 67.4% found buyers from an offering of 31,024 metric tons (142,490 480-pound bales), which were reduced after sluggish buying the prior day.

    In ICE cotton futures Wednesday, May settled back above its nine-day moving average and for a second day finished above its 18-day MA, seen technically as positive short-term and intermediate-term signals.

    Stepped-up options activity in the old-crop contracts featured the May 78, 80 and 82 call strikes, a trader said. July options saw increased activity in the 78, 80, 90 and 92 strikes.

    The May-July spread traded from 111 to 96 points carry and narrowed three points to settle at a 101-point July premium on 3,304 lots. Inverted July-December widened 58 points to a 374-point settlement premium on July on 1,473 lots, trading from 324 to 382 points. The December-March inversion narrowed a point to an 18-point settlement premium on December.

    In cash online trading, overall sales increased to 7,388 bales from 3,016 bales on The Seam. Prices averaged a gross 73.17 cents, up from 71.01 cents. Premiums over loan repayment rates dipped to a gross average of 20.24 cents from 20.64 cents. Offerings were 69,829 bales.

    The Cotlook A Index of world values rose 30 points to 86.40 cents, widening the premium over the prior-day May futures settlement two points to 9.25 cents.

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