Weekly Cotton Market Review

Transcription

1 Mp_cn812 Weekly Cotton Market Review Cotton and Tobacco Program Cotton Market News Division 3275 Appling Road Memphis, TN Vol. 100 No. 12 October 19, 2018 Inside this Issue Market Overview Price Support Spot quotation averages were 142 points higher than the previous week, according to the USDA, Agricultural Marketing Service s Cotton and Tobacco Program. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-3 and 43-49, strength , and uniformity ) in the seven designated markets averaged 74.7 cents per pound for the week ending Thursday, October 18, The weekly average was up from last week and from 5.9 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of cents Monday, October 15 to low of cents Wednesday, October 17. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended October 18 totaled 4,808 bales. This compares to 1,783 reported last week and 5,235 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 27,380 bales compared to 55,75 bales the corresponding week a year ago. The ICE December settlement prices ended the week at cents, compared to 7.81 cents last week. Spot Quotations ICE Futures A Index Southeastern Textile Mill Report South Central Southwestern Western Pima Quotations Cotton Market Reports Subscribe to this report Subscribe to all Cotton Market reports Sources: USDA, AMS, Cotton and Tobacco Program, 1/ Cotlook

2 Southeastern Markets Regional Summary Danny Pino Macon, GA Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was moderate. Average local spot prices were higher. Trading of CCC-loan equities was inactive. Harvesting gained momentum across the lower Southeastern region as fair to sunny conditions prevailed early in the period. Daytime high temperatures were in the upper 70s to mid-80s, with nighttime lows in the mid-50s to mid-0s. The clear and warm weather helped soft soils to firm and bleach out lint that was soaked from Hurricane Michael. Initial assessments from local experts indicated that yield losses could range from 50 to 90 percent in some fields of the Florida panhandle, south Georgia, and the Wiregrass region of Alabama that were in the direct path of the storm as it made landfall and maintained hurricane strength as it tracked inland. No significant damage to gins was reported, but pressing operations remained idle at some locations until power is restored to the area. The Georgia Cotton Commission encouraged producers to document damage and losses before, during, and after cleanup; as well as financial records of cleanup and repair related costs in preparation for filing for crop insurance and/or assistance. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released October 15, cotton harvested in Alabama reached 28 percent and 20 percent in Georgia. Mostly sunny to partly cloudy conditions prevailed across the Carolinas and Virginia early in the period. Daytime high temperatures varied from the mid-0s to low 80s. Harvesting advanced across the region as producers continued to deal with the after effects by heavy rainfall and high winds. According to the NASS Crop Progress report released October 15, cotton harvested reached 18 percent in South Carolina, 17 in North Carolina, and 12 percent in Virginia. Textile Mill Inquiries from most mill buyers were light as reports indicated most mills have covered their raw cotton needs through the first quarter of Demand was moderate for color 41, leaf 4, and staple 34 for second quarter 2019 delivery. No sales were reported. Demand for open-end and ring-spun yarn was moderate. Most mills operated five to seven days. Demand through export channels was moderate. Representatives for mills throughout the Far East inquired for any discounted styles of cotton. Trading No trading activity was reported. 2

3 South Central Markets Regional Summary Jeff Carnahan Memphis, TN North Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Harvesting advanced normally early week, then stalled as a cold front brought heavy rain and much cooler temperatures to the region mid-week. Local experts reported almost 3 inches of moisture in some parts of Tennessee, while the Bootheel of Missouri received about one-quarter of an inch. Daytime highs remained in the mid-0s. Overnight lows were in the low 40s. Outdoor activities were delayed in fields with saturated soil. Low-lying areas were flooded. Most gins had sufficient modules on their yards to continue pressing operations without any interruption. According to the National Agricultural Statistics Service s Crop Progress report released October 15, harvesting jumped to 7 percent in Arkansas, 70 in Missouri, and 50 percent in Tennessee. Producers have reported a sharp increase in the number of light-spotted bales in their classing results compared to last season s crop, but yields have generally been good. South Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Producers made excellent progress harvesting during the period. A cold front brought cooler temperatures to the region late in the week. Less than 1 inch of moisture was reported in localized places. Daytime highs dropped into the mid-0s. Overnight lows were in the 50s in most areas. Outdoor activities were briefly suspended due to wet lint and soft soils in isolated areas. Most gins had an adequate supply of modules on their yards to maintain operations without any delays. According to the National Agricultural Statistics Service s Crop Progress report released October 15, harvesting had reached 5 percent in Louisiana and 0 percent in Mississippi. Producers reported yields of up to 1,800 pounds in a few fields. Producers have noticed more light-spotted bales among the samples submitted for classing compared to last year. Trading A light volume of color 41 and 42, leaf grade 4 and better, staple 37 and longer, mike averaging 4.5, strength averaging 28.5, and uniformity averaging 83.0 traded for around cents per pound, FOB car/truck (Rule 5, compression charges paid). No trading activity was reported. South Delta 3

4 Southwestern Markets Regional Summary Jane Byers-Angle Lubbock, TX East Texas Spot cotton trading was moderate. Supplies and producer offerings were light. Demand was light. Average local spot prices were higher. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Gins in the Rio Grande Valley were finished. Ginning continued in the Upper Coast and in the Blackland Prairies (BP). Some gins in the northern BP slowed ginning because of lightening and excessive rainfall. Local reports indicated that some areas received as much 12 inches of precipitation. Harvesting was around 0 percent completed. Producers were eager for fields to dry so they could resume harvesting. They were hopeful that the quality would be preserved. Rainfall was received in Kansas and Oklahoma, which brought up to 10 inches. Field activity was limited. Approximately 75 percent of the fields have been defoliated, and about 25 percent were ready to be harvested. Kansas received a light dusting of snow. Oklahoma gins continued to submit samples to the Abilene Classing Office for grading services. Meetings were held. West Texas Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was very light. Average local spot prices were higher. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Cooler, wet conditions prevailed as remnants of the Tropical Storm Sergio and Canadian winter air moved into the region. Wintery precipitation was received in the north-western counties of the panhandle. Some areas received the first freezing temperatures of the season with daytime highs in the mid-30s to low 70s, and overnight lows in the upper 20s to mid-50s. Some stands have been defoliated; while others still have full canopies with few open bolls. Harvesting and ginning were at a standstill until fields dried. More rain is in the nearby forecast. Producers are ready to start harvesting again as soon as conditions improve. Trading East Texas A moderate volume of new-crop cotton containing color 31 and better, leaf 3 and better, staple 38 and longer, mike averaging 4.4, strength averaging 30.4, and uniformity averaging 82.0 sold for around cents per pound, FOB warehouse (compression charges not paid). A light volume of new-crop cotton containing color 21 and 31, leaf 3 and 4, staple 3, mike averaging 43., strength averaging 31.3, and uniformity averaging 82.2 sold for around cents, same terms as above. A light volume of mixed-lots containing mostly color 31 and better, leaf 3 and better, staple 3 and longer, mike 43-39, strength averaging 30.5, and uniformity averaging 82.0 sold for around cents, same terms as above. A light volume of mostly color 21 and 31, leaf 2 and 3, staple 38 and longer, mike averaging 45.5, strength averaging 31.0, and uniformity averaging 81.2 sold for around cents, same terms as above. West Texas A light volume of new-crop cotton containing color 21 and 31, leaf 2 and 3, staple 38 and longer, mike 39-44, strength 31-34, and uniformity sold for around 7.00 cents per pound, FOB car/truck (compression charges not paid). 4

5 Southwestern Markets Regional Summary Jane Byers-Angle Lubbock, TX Photos courtesy of: Jane Byers-Angle, Southwestern Reporter 5

6 Maria Townsend Western Markets Regional Summary Visalia, CA Desert Southwest (DSW) Spot cotton trading was slow. Supplies and demand were light. Producers offered cotton early in the period. A few trades were reported. Average local spot prices were higher. No forward contracting or domestic mill activity was reported. Foreign mill inquiries remained light. Tropical Storm Sergio came through southern Arizona and produced localized soaking rainfall over a three-day period. Precipitation amounts ranged from 2 to 3 inches. Weather experts reported that this was one of the wettest October s in recent memory, which was helped with two back-to-back Tropical Storms. Overcast, cloudy conditions with temperatures in the high 0s to mid-70s prevailed in Arizona. No damage was reported to cotton fields, as no strong winds were associated with the storm. Harvesting was virtually completed in Yuma. Initial harvesting was underway in central and Safford Arizona, but was halted by steady rainfall. Locations in western Arizona need fields to dry out in order to re-apply defoliants. Some modules were moved to gin yards ahead of the rain, so some gins began ginning early in the period. Dry, sunny conditions are needed to resume harvesting. Breezy conditions entered the state late in the period. Temperatures dropped into the 50s and 0s in New Mexico and El Paso, TX. Scattered showers brought one-third of an inch to one inch of rainfall in the period. Overall, the crop needs dry, sunny conditions to resume harvesting. No ginning was reported. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were higher. No forward contracting or domestic mill Trading activity was reported. Merchant offerings and foreign mill inquiries were light. Sunny, dry conditions ruled, with temperatures in the high 70s to low 80s. Harvesting and ginning gained momentum. American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were steady. No forward contracting or domestic mill activity was reported. Foreign mill inquiries remained light. According to the Foreign Agricultural Service export sales report approximately 295,700 bales of 2018-crop AP was committed for the week ending October 11. Daytime high temperatures were in the high 0s to high 80s in Arizona and California. Cooler conditions were reported in New Mexico and El Paso, TX, with temperatures in the 50s to 0s. Weather systems brought rainfall to Arizona, New Mexico, and El Paso, TX. Arizona received 2 to 3 inches of rainfall throughout the week. Scattered showers brought one-third of an inch to one inch of rainfall to New Mexico and El Paso, TX. No rainfall was reported in California. Very little AP acreage in central Arizona was ready for harvest prior to the rain events. Local sources estimated wet conditions will delay defoliation activities, and in turn harvest will be delayed up to three weeks or more. Sources in the Safford area estimated a delay of five to seven days, with some fields showing wet cotton stringing out. Breezy conditions entered the region and should help to dry field conditions. Harvesting in the San Joaquin Valley of California made good progress. Ginning continued. Desert Southwest A light volume of color 11 and 21, leaf 2 and better, staple 3 and 37, mike 35-49, strength averaging 32.18, and uniformity averaging sold for around 50 points on ICE December futures, uncompressed, FOB warehouse. A light volume mixed lot containing mostly color 11 and 12, leaf 2 and better, staple 35 and longer, mike 38-52, strength averaging 29.8, and uniformity averaging sold for around 200 points off ICE December futures, same terms as above. No trading activity was reported. No trading activity was reported. San Joaquin Valley American Pima

7 World market prices for upland cotton, in cents per pound, in effect from 12:01 a.m., EDT, Friday through midnight, EDT, Thursday Sep Sep Sep 28 Oct Oct Oct Oct Adjusted world price 1/ Course count adjustment Loan Deficiency Payment (LDP) Fine count adjustment Fine count adjustment / Color 41, leaf 4, staple 34, mike 35-3 & 43-49, strength readings of grams per tex, length uniformity of percent. Source: Farm Service Agency, USDA. Description Outstanding sales Exports Total export commitments Through October 12, 2017 Through October 11, 2018 Week Mkt. Year Week -,210,000-8,100 1,592, ,300-7,802,000 - New sales 25,300-5,700 - Buy-backs and cancellations 3,100-33,000 - Net sales Sales next marketing year ,200-32,700 8, ,100 24, Mkt. Year 9,15,000-1,737,300 Net sales of 32,700 RB for 2018/2019 were down 7 percent from the previous week and 55 percent from the prior 4-week average. Increases were reported for Pakistan (13,400 RB), Vietnam (11,900 RB, including 300 RB switched from Japan), Mexico (10,00 RB), Thailand (7,200 RB, including 400 RB switched from Japan), and Ecuador (5,200 RB). Reductions were reported for China (18,500 RB), Bangladesh (5,900 RB), and Japan (2,100 RB). For 2019/2020, net sales of 24,200 RB were reported for China (17,00 RB) and Thailand (,00 RB). Exports of 135,300 RB were down 35 percent from the previous week and 20 percent from the prior 4-week average. Exports were primarily to China (33,100 RB), Vietnam (25,800 RB), Mexico (17,400 RB), Indonesia (10,00 RB), and Pakistan (8,900 RB). Net sales of Pima totaling 5,000 RB for 2018/2019 were down 1 percent from the previous week and 2 percent from the prior 4-week average. Increases were reported for China (4,400 RB), Japan (300 RB), and India (200 RB). Exports of,300 RB were up noticeably from the previous week and up 31 percent from the prior 4-week average. The primary destinations were India (4,500 RB), Turkey (1,100 RB), and Pakistan (500 RB). Optional Origin Sales: For 2018/2019, the current outstanding balance of 1,800 RB is for Vietnam. Marketing Years 7,418,300 1,737,700 Exports for Own Account: New exports for own account totaling 2,300 RB were reported to Vietnam. The current exports for own account outstanding balance of 9,700 RB is for China (7,400 RB) and Vietnam (2,300 RB). Source: Export Sales Reporting Division, Foreign Agricultural Service, USDA. NOTE: Data may not add due to rounding. October 18, 2018 USDA ANNOUNCES SPECIAL IMPORT QUOTA #2 FOR UPLAND COTTON October 18, 2018 The Department of Agriculture's Commodity Credit Corporation announced a special import quota for upland cotton that permits importation of a quantity of upland cotton equal to one week s domestic mill use. The quota will be established on October 25, 2018, allowing importation of 12,807,185 kilograms (58,822 bales) of upland cotton. Quota number 2 will be established as of October 25, 2018, and will apply to upland cotton purchased not later than January 22, 2019, and entered into the U.S. not later than April 22, The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period June 2018 through August 2018, the most recent three months for which data are available. Future quotas, in addition to the quantity announced, will be established if price conditions warrant. 7

8 Number of Bales in Certificated Stocks Delivery Points Stocks as of Awaiting Review Non-Rain Grown Cotton Dallas/FT. Worth, TX 5, Galveston, TX Greenville, SC Houston, TX Memphis, TN 18, Total 24, Spot quotations are in cents per pound for cotton equal to the Official Standards, net weight, in mixed lots, compressed, FOB car/truck. SOUTHEAST NORTH DELTA SOUTH DELTA DESERT SOUTHWEST Staple EAST TEXAS-OKLAHOMA WEST TEXAS SAN JOAQUIN VALLEY Staple MIKE DIFFERENCES - POINTS PER POUND SOUTH- NORTH SOUTH E. TX WEST DESERT SJ EAST DELTA DELTA OK Mike Ranges TEXAS SW VALLEY AVG & Below Base Base & Above STRENGTH DIFFERENCES UNIFORMITY DIFFERENCES SOUTH- NORTH SOUTH E. TX Grams WEST DESERT SJ SOUTH- NORTH SOUTH E. TX Unit WEST DESERT SJ EAST DELTA DELTA OK per tex TEXAS SW VALLEY AVG. EAST DELTA DELTA OK TEXAS SW VALLEY AVG & below Diff Base Base & above & above October 18,

9 American Pima quotations are for cotton equal to the Official Standards, net weight, in mixed lots, UD Free, FOB warehouse. 1/ AMERICAN PIMA SPOT QUOTATIONS Color Leaf Staple The current Pima spot quotations represent prices from local sales, export sales, and offerings last reported on May 30, Type - Level Other - Level Plastic - Level 2 Diff Plastic - Level / Pima spot quotations for color-leaf-staple combinations not quoted will be included as sales of those qualities which are reported. Range 2 & Below & Below & Above Extraneous Matter Prep - Level Prep - Level 2 Mike Strength & Above 0 Range (Grams per Tex) Diff Diff Other - Level October 18,