The cotton market is slightly higher Friday morning as it awaits the supply-demand update from USDA, as well as any weather updates into next week.
For Friday’s report, the average trade expectation calls for an ending stocks number of 3.54 million bales. That amount would be fractionally higher than the March report of 3.50 million bales. World ending stocks are expected to be higher, with estimates pegging 82.64 million bales. The March report showed global stocks at 82.57 million. The report will be out at 12:00 p.m. EST.
The latest Drought Monitor from NOAA is now indicating worsening conditions across much of Texas and the Oklahoma Panhandle. Above-normal temperatures combined with below-normal precipitation, plus strong blowing winds are adversely affecting the situation. Now both the six to ten-day and the 8 to 14-day forecasts essentially call for below-normal rainfall for West Texas.
From Thursday’s weekly export sales, we note that cumulative sales for the 2021/22 season have reached 14.26 million bales. Although that number is down from last year (14.85 million), it is above the five-year average of 14.095 million bales. Sales have reached 103% of the USDA’s forecast for the current marketing season, compared to the five-year average of 99%.
For Friday, close-in support for May cotton is 132.80 cents and 131.85, cents while resistance stands at 135.00 cents and 135.90 cents. The estimated morning volume is 9,814 contracts.