The cotton market is starting the new week moderately lower as harvest pace is expected to run at full throttle. That attitude is due to the fact the weather across much of the cotton belt is expected to be near perfect. Monday at 4 p.m. EST, USDA will release its latest harvest progress data. Last week’s data indicated the crop was at 62% gathered; after this week, the harvest may be 75% complete nationally.
This Friday, spot December cotton will enter its delivery period. That means by Thursday, only those wishing to be a part of the delivery process will maintain their positions. Producers will have to either fix their existing contracts, or roll them out into some other deferred contract.
Also on Thursday, there will be the usual weekly sales and export report. Last week’s data was a marketing-year-high sales number of 345,000 bales. Moreover, China was a buyer of 83,000 bales within that total. The market may not top that effort, but with the U.S. holidays approaching, foreign customers might want to make deeper purchases now.
The U.S./China trade talks from this past weekend were deemed “constructive”. However, no actual place or time has been set for a signing ceremony. As long as impeachment proceedings continue, the Chinese are apt to take a wait-and-see attitude, and string the talks out farther across the calendar.
For today, support for the fading December contract stands at 63.85 cents and 63.45 cents, with resistance at 65.10 cents and 66.00 cents. Overnight estimated support is 7,341 contracts.
