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. 14 November 2, 2018 Inside this Issue Market Overview Price Support Average spot quotations were 71 points lower 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 cents per pound for the week ending Thursday, November 1, The weekly average was down from last week, but up from.92 cents reported the corresponding period a year ago. Daily average quotations ranged from a low of cents Wednesday, October 31 to high of cents Thursday, November 1. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended November 1 totaled 5,847 bales. This compares to 5,943 reported last week and 38,785 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 39,170 bales compared to 117,707 bales the corresponding week a year ago. The ICE December settlement prices ended the week at cents, compared to 77.8 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 slow. Supplies and producer offerings were light. Demand was moderate. Average local spot prices were lower. Trading of CCC-loan equities was inactive. Harvesting advanced throughout south Georgia and central and north Alabama. Ideal weather conditions prevailed much of the period with variable daytime high temperatures in the upper 0s to lower 80s. Fieldwork was delayed in portions of south Alabama and the Florida panhandle where fields remained too soggy to support equipment, due to excessive moisture received during the previous period. In addition, harvesting was interrupted late week as a band of thundershowers brought moderately heavy precipitation to areas across the lower Southeastern region. Producers would welcome a period of dry and sunny weather to allow soft soils to firm and bleach out rain soaked lint on the stalk. Re-growth was reported in many fields, due to wet and unseasonably warm conditions. In southeast Alabama, southwest Georgia, and Florida, it has been three weeks since Hurricane Michael blew through and producers continue to report significant yield losses. Local experts reported lint covered fields and seeds sprouting in the middle of the rows. Producers were also contending with twisted and tangled stalks in salvageable fields which hampered harvest. The Macon Classing Office added a third shift and will begin 24-hour classing operations. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released October 29, cotton harvested reached 50 percent in Alabama and 42 percent in Georgia. Producers made good progress as harvesting and fieldwork advanced across the upper Southeastern region. Daytime high temperatures varied from the upper 50s to low 80s. Fieldwork was slowed over the weekend as thundershowers brought moderate moisture to areas throughout the Carolinas and Virginia. Precipitation totals measured from three-quarters of an inch to around two inches in the heaviest rain events. Dry and sunny conditions allowed harvesting to resume during the week and producers attempted to get as much cotton off the stalk as possible ahead of wet weather that returned late week. Local experts reported cotton yields were lower in areas adversely impacted by Hurricane Florence. According to NASS, cotton harvested reached 51 percent in Virginia, 48 in North Carolina, and 34 percent in South Carolina. Textile Mill Demand was light for color 41, leaf 4, and staple 34 for first and second quarter delivery. No sales were reported. Reports indicated most mills have covered their raw cotton needs through the fourth quarter Demand for open-end and ring-spun yarn was moderate. Most mills operated five to seven days. Demand through export channels was moderate. Demand throughout the Far East was good for any discounted styles of cotton. Trading Even-running lots containing color 31, leaf 2 and 3, staple 37 and 38, mike 43-49, strength 30-33, and uniformity sold for around 250 points on ICE December futures, FOB car/truck (Rule 5, compression charges paid). A moderate volume of color mostly 31, leaf 2 and 3, staple 3 and longer, mike 43-49, strength 28-31, and uniformity sold for around 225 points on ICE December futures, same terms as above. A moderate volume of color 31 and 41, leaf mostly 2 and 3, staple 34 and 35, mike 43-49, strength 25-28, and uniformity sold for around 25 points off ICE December futures, FOB car/truck, Georgia terms (Rule 5, compression charges paid, 30 days free storage). 2

3 South Central Markets Regional Summary Jeff Carnahan Memphis, TN North Delta Spot cotton trading was inactive. Supplies of available cotton were moderate. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. Harvesting advanced steadily most of the week, then stalled as another storm brought heavy rain showers late week throughout the region. Local experts reported about 2 inches of precipitation in most places, with nearly 4 inches recorded in localized places. Daytime highs fluctuated from the 50s to 80s. Overnight lows were in the 40s and 50s. Outdoor activities were delayed in the remaining unharvested fields. Minor flash flooding was reported. Widespread re-growth was reported in previously defoliated fields. Some producers opted for a second application of defoliant; most were harvesting slowly under less-than-optimal conditions. Producers have reported good yields, but a decline in several quality factors, especially color. Most gins maintained pressing operations without any weather related interruptions; some gins reported some modules saturated with flood water. According to the National Agricultural Statistics Service s Crop Progress report released October 29, harvesting advanced slowly to 8 percent in Arkansas, 87 in Missouri, and 8 percent in Tennessee. South Delta Spot cotton trading was inactive. Supplies of available cotton were moderate. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. Producers made steady progress harvesting during the period. A storm front brought more rain to the region late in the week. Up to 2 inches of moisture were reported in localized places. Daytime highs jumped into the 80s. Overnight lows were in the 50s in most areas. Adverse weather conditions, particularly in the form of persistent rain storms, have hampered activities this harvest season. Most producers have reported average to above average yields, and a sharp increase in light-spotted bales compared to last year. Fieldwork activities were stalled, due to wet cotton bolls and soft soils in unharvested fields. Some gins reported difficulty processing water-soaked modules. According to the National Agricultural Statistics Service s Crop Progress report released October 29, harvesting had reached 8 percent in Louisiana and 77 percent in Mississippi. Trading North Delta A light volume of color mostly 41 and 42, leaf 3 and better, staple 3 and longer, mike 43-49, strength 27-31, and uniformity 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 lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Interest was best from Bangladesh, Pakistan, and Turkey. The Blackland Prairies received more rain on October 31, which further delayed harvesting and slowed ginning. Local reports indicated that most areas received one-half to one and one-quarter of an inch of additional rainfall. Some gins caught up to the modules on the gin yards and have experienced down-time. Ginning continued in south Texas. Most of the gins in the Coastal Bend completed the season. The last remaining gin in that area is expected to finish during the weekend of November 2. The Winter Garden area is nearing completion, but has experienced weather delays with 2 to inches of rainfall. Oklahoma ginning expanded as modules picked before the rain events were transported to the gin yards. A light amount of picker harvesting had begun as fields firmed. Two more gins began offering pressing services. A light amount of harvesting was underway in Kansas, and a few modules had begun to accumulate on gins yards. Very little has been harvested and not all of the gins were open. West Texas Spot cotton trading was slow. Supplies and producer offerings were light. Demand was very light. Average local spot prices were lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Interest was best from Bangladesh, Pakistan, and Turkey. Daytime temperature highs were in the upper 40s to low 80s, and overnight temperature lows were in the upper 20s to low 50s. A drying trend prevailed, although light-to-moderate rainfall was received on October 31. Producers were eager to begin harvesting as soils firmed around Lubbock and in the Panhandle. Caravans of field equipment were moving to the fields. Harvesters and module builders were staged near fields. A drying trend is in the nearby forecast and harvesting activities were expected to expand in the High Plains. Stands were in good condition in the Rolling Plains, but cotton was strung out from the boll, according to local reports. Producers were ready to begin harvesting and apply defoliants. Trading East Texas In Texas, a light volume of mostly color 31 and 41, leaf 3 and better, staple 37 and longer, mike 38-47, strength 29-35, and uniformity sold for around cents per pound, FOB warehouse (compression charges not paid). In Oklahoma, a light volume of color 11 and 21, leaf 1 and 2, staple 37 and longer, mike 3-42, strength 30-35, and uniformity sold for around cents, FOB car/truck (compression charges not paid). A light volume of mostly color 21 and 31, leaf 2 and 3, staple 38 and 39, mike 43-47, strength 29-31, and uniformity sold for around 7.00 cents, same terms as above. West Texas A light volume of color 42 and better, leaf and better, staple 34 and 35, mike averaging 49.5, strength 28-32, uniformity averaging 81.8, and 25 percent extraneous matter sold for around cents per pound, FOB car/truck (compression charges not paid). A light volume of mostly color 43, leaf 5, staple 34 and 35, mike averaging 45.8, strength 25-32, and uniformity sold for around cents, same terms as above. 4

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

6 Maria Townsend Western Markets Regional Summary Visalia, CA Desert Southwest (DSW) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries remained light. Interest was best from India. Temperatures were in the 70s and 80s in Arizona. Harvesting and ginning continued uninterrupted. The Visalia Classing Office reported the season average of color 31 and better was at 73 percent, leaf 3 and better at 88 percent, mike averaging 4.47, staple averaging 3.59, and strength averaging for week ending November 1. Daytime high temperatures were in the 0s to 70s for New Mexico and El Paso, TX. Harvesting was slow, due to waiting for morning dew to burn off. Ginning had begun on a limited scale. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Merchant offerings and foreign mill inquiries were light. Harvesting and ginning continued uninterrupted. Local sources estimated harvest was 85 to 90 percent completed. Some producers reported exceptional yield averages of 4 bales per acre. The Visalia Classing Office reported the season average of Upland saw-ginned color 21 and better was at 88 percent, leaf 2 and better at 75 percent, mike averaging 4.50, staple averaging 37.71, and strength averaging 34.9 for week ending November 1. Roller-ginned Upland season average for color 31 and better was at 93 percent, leaf 3 and better at 99 percent, mike averaging 4.37, staple averaging 39.52, and strength averaging American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries remained light; although some fill-in business was reported. Shippers reported market conditions seemed like summer slow. No new business with China. Daytime high temperatures were in the 70s and 80s for the Far West. Harvesting and ginning continued uninterrupted. Local sources reported that 85 to 90 percent of the crop was off the stalk in California. The Visalia Classing Office reported the season average AP color 2 and better at 99 percent, leaf mostly 2 and better, staple averaging 48.83, mike averaging 4.25, and strength averaging for week ending November 1. No trading activity was reported. No trading activity was reported. No trading activity was reported. Trading Desert Southwest San Joaquin Valley American Pima

7 Western Markets Regional Summary Maria Townsend Visalia, CA Photos courtesy of: Maria Townsend, Far West Reporter 7

8 World market prices for upland cotton, in cents per pound, in effect from 12:01 a.m., EDT, Friday through midnight, EDT, Thursday Sep 28 Oct Oct Oct Oct 2 Oct Nov 1 Nov 2-8 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 2, 2017 Through October 25, 2018 Week Mkt. Year Week -,527,100-8,800 1,773, ,800-8,300,500 - New sales 224,500-2,400 - Buy-backs and cancellations 15, ,400 - Net sales 209,500 - (49,000) - Sales next marketing year Marketing Years 47,100 8,000 92, Mkt. Year 7,10,900 1,98,00 9,147,500 1,834,800 Net sales reductions of 49,000 RB for 2018/2019--a marketing-year low--were down noticeably from the previous week and from the prior 4-week average. Increases reported for Pakistan (11,700 RB), Turkey (10,500 RB), India (8,800 RB), Taiwan (5,500 RB), and Peru (3,000 RB), were more than offset by reductions for China (81,300 RB). For 2019/2020, net sales of 92,900 RB were reported for China (88,000 RB) and Turkey (4,400 RB). Exports of 109,800 RB were down 21 percent from the previous week and 34 percent from the prior 4-week average. Exports were primarily to Pakistan (19,400 RB), Vietnam (18,200 RB), Bangladesh (12,00 RB), Mexico (11,00 RB), and China (10,100 RB). Net sales of Pima totaling 25,500 RB for 2018/2019--a marketing-year high--were up noticeably from the previous week and from the prior 4-week average. Increases were reported for India (12,100 RB), China (8,300 RB), Vietnam (1,300 RB, switched from China), Thailand (1,200 RB), and Turkey (1,200 RB, including decreases of 100 RB). Exports of 4,900 RB were down 4 percent from the previous week, but up 14 percent from the prior 4-week average. The primary destinations were India (2,700 RB) and Peru (1,800 RB). Optional Origin Sales: For 2018/2019, the current outstanding balance of 1,800 RB is for Vietnam. Exports for Own Account: New exports for own account totaling 1,800 RB were reported to Vietnam. Exports for own account to China totaling 200 RB were applied to new or outstanding sales. The current exports for own account outstanding balance is 7,200 RB, all China. Source: Export Sales Reporting Division, Foreign Agricultural Service, USDA. November 1, 2018 USDA ANNOUNCES SPECIAL IMPORT QUOTA #2 FOR UPLAND COTTON November 1, 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 November 8, 2018, allowing importation of 12,807,185 kilograms (58,822 bales) of upland cotton. Quota number 2 will be established as of November 8, 2018, and will apply to upland cotton purchased not later than February 5, 2019, and entered into the U.S. not later than May, 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. 8

9 Number of Bales in Certificated Stocks Delivery Points Stocks as of Awaiting Review Non-Rain Grown Cotton Dallas/FT. Worth, TX 5, Galveston, TX 3, Greenville, SC Houston, TX 2, Memphis, TN 1, Total 29, 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 November 1,

10 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 October 31, 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 November 1,