December cotton was up 1.02 cent early Friday, trading at new contract highs while hot temperatures continue to bake the soil in West Texas.
Early Friday, December cotton was up 1.02 cent at a new contract high of 93.81 cents with strong noncommercial support and reluctance of potential sellers to get in front of cotton’s one-way uptrend. West Texas remains the most obvious bullish concern in early 2018 with ongoing drought and hot temperatures in early June.
Aside from some flooding damage from Tropical Storm Alberto, other U.S. cotton regions are doing well overall. Friday’s seven-day forecast expects more moderate rain amounts across the southeastern U.S. while West Texas remains mostly dry. The Mississippi Delta is on the edge of the forecast for rain. Outside the U.S., no significant production problems are being reported.
Technically, the trend in December cotton remains up and continues to push higher, even as speculators are heavily committed to the long side.
In cash online trading, The Seam showed 3,956 bales sold Thursday at an average price of 69.37 cents. Average loan value was 43.52 cents and 28,239 bales were offered.
The ICE daily stocks report showed certified stocks down 289 on Thursday at 78,377.
The Cotlook A Index of world values for June 7 was up 1.50 cents at 99.00 cents, putting the premium over the July futures settlement at 5.28 cents.
In outside markets, the June U.S. dollar index is up 0.35 at 93.73, while Dow Jones Industrial Average futures are down 75 points in early trading. July crude oil is down 8 cents and August gold is down $0.90 at $1,302.10. July corn is up 1/4 cent, July soybeans are down 3 1/4 cents, and July Kansas City wheat up 1/4 cent.