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. 99 No. 5 September 1, 2017 Inside this Issue Market Overview Price Support Spot Quotations ICE Futures A Index Southeastern Textile Mill Report South Central Southwestern Western Pima Quotations ***Special Announcement*** The Corpus Christi, TX Classing Office resumed grading operations on Thursday August 31. The Memphis, TN Classing Office will complete grading samples from Corpus Christi by COB Saturday, September 2. Average quotations were 204 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 , uniformity ) in the seven designated markets averaged 9.05 cents per pound for the week ending Thursday, August 31, The weekly average was up from 7.01 last week, and 5.30 cents reported the corresponding period a year ago. Daily average quotations ranged from a low of 7.15 cents Friday, August 25 to a season high of 70.0 cents Thursday, August 31. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended August 31 totaled 2,5 bales. This compares to 3,538 bales reported last week and 2,30 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 1,59 bales compared to 10,99 bales the corresponding week a year ago. The ICE October settlement prices ended the week at cents, compared to cents last week. 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. Producers took advantage of higher ICE futures recently to fix prices on a moderate volume of 2017-crop cotton. Partly cloudy to overcast conditions prevailed across Alabama, the Florida panhandle, and Georgia during much of the period with daytime high temperatures in the upper 80s to mid-90s. Scattered thundershowers brought around one-half of an inch of moisture to areas of north Alabama early week. Areas of south Alabama and the Florida panhandle received moderate precipitation mid-week. Dryland acreage benefitted from the rainfall, which replenished topsoil moisture and invigorated plants. In Georgia, producers have maintained irrigation schedules as drier conditions have prevailed recently. Plants were cutting out in the earliest planted fields and bolls were cracking open on the bottom of plants. Silver leaf whitefly populations were increasing in south Alabama, the Florida panhandle, and Georgia. Producers were applying control measures to combat the pests. Mostly sunny to overcast conditions dominated the weather pattern in the upper Southeastern region with cooler daytime high temperatures in the mid-70s to upper 80s. The crop progressed well and boll-setting neared completion; the lowermost bolls in the oldest fields were cracking open. Producers scouted fields for insect pests and applied treatments to hot spots. Areas of South Carolina and Virginia would benefit from timely rainfall as dry conditions have prevailed in recent weeks and reduced plant vigor in some dryland fields. According to the National Agricultural Statistics Service s Crop Progress report released August 28, cotton bolls opening reached 21 percent in Georgia and South Carolina, 13 in Alabama, 11 in North Carolina, and 10 percent opened in Virginia. Textile Mill Demand was good for color 41, leaf 4, and staple 34 and longer for second and third quarter 2018 delivery. Domestic mill buyers purchased a moderate volume of color 41, leaf 4, and staple 34 for December through March 2018 delivery. No additional sales were reported. Some mills anticipated increased cotton consumption during the fourth quarter of 2017 as yarn demand improved. Sources also indicated some mills fixed prices on a moderate volume of previously booked 2017-crop cotton as ICE futures trended higher during the period. Yarn demand was moderate to good. Most mills operated five to seven days. Demand through export channels was moderate. Representatives for mills in Pakistan inquired for a moderate volume of USDA Green Card Class, color 41, leaf 4, and staple 3 for May 2018 shipment. No sales were reported. Trading 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. Cool, overcast skies with light, scattered showers prevailed during the week. The remnants of Hurricane Harvey moved through the region late-week. Overall rainfall measured around 4 to 7 inches generally, with up to 3 inches locally. Daytime temperatures were in the 80s and overnight lows were in the 0s and 70s. Many fields had reached the stage where no additional inputs were required to finish to crop. Defoliation had begun on a limited basis in early-planted fields and was expected to gain momentum once soft soils were firm enough to support equipment. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released August 28, open bolls had reached 15 percent in Arkansas and in Missouri, with 9 percent in Tennessee. NASS also reported that the crop condition in Arkansas was rated at 8 percent good-to-excellent, compared with 59 percent in Missouri and 88 percent in good-to-excellent condition in Tennessee. 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. Mostly wet, cloudy, and warm weather conditions prevailed during the week. Daytime temperatures were in the 80s and overnight lows were in the 0s and 70s. Heavy thunderstorms brought 5 to 10 inches of rain as the remnants of Hurricane Harvey swept through the region. Flood watches were in effect in many counties. Producers were anxiously waiting to assess the impact of the additional moisture, in terms of boll rot and boll lock, not to mention the overall quality of cotton in fields with open bolls. Defoliation had just begun and was expected to expand once fields were dry enough to support equipment. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released August 28, open bolls was at 43 percent in Louisiana, compared to 23 percent in Mississippi. NASS also reported that 3 percent of the crop was in good to excellent condition in Louisiana, compared to 71 percent in Mississippi. Trading North Delta 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 moderate. Demand was very good. Average local spot prices were higher. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Hurricane Harvey brought torrential rainfall and high winds to fields; all harvesting and ginning activities in southern Texas was interrupted. Cities and towns received rainfall in feet, not inches, and experienced historic flooding. A few farms reported less than 10 inches of precipitation in several counties around Corpus Christi and Houston, while other farming operations reported up to 30 inches of rainfall. Producers reported that cotton in unharvested fields was blown out of bolls and floating in flood water. Damage was extensive to some gins and an undetermined number of modules. Damage assessments will take weeks and maybe months, depending on how long it takes fields to dry and flood waters to retreat. Many roadways were underwater and trucks were unable to transport modules to gin yards and bales to shipping points. The Houston and Galveston ports have resumed operations, according to industry reports. The focus was not on cotton this week, but rather saving and sustaining lives. Harvesting neared completion and ginning continued in the Rio Grande Valley (RGV), where one-fourth to one-half of an inch of rainfall was received early in the reporting period. The RGV was on the dry side of the hurricane and was spared any serious damages. The logistics has been affected and trucks are unable to enter into the RGV to pick up bales. Shippers are unable to transport loads out of the Galveston or Houston ports. In Kansas, the stands advanced and a few bolls had begun to crack open. No rainfall was reported. Generally, the crop needs sunny weather in September to move from a good crop to a great crop. Timely rainfall was received in Oklahoma that helped the stands. Some fields were sprayed for insects. More heat units are needed to help the crop mature. 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 moderate. Trading of CCC-loan equities was inactive. Foreign inquiries were light. The crop advanced with intermittent showers from eastern New Mexico. The west Texas area received rain from remnants of Hurricane Harvey. Temperature highs were about 10 degrees cooler than normal and mostly in the mid-80s. Nighttime temperature lows were in the mid-50s. The stands need heat units to mature the crop. Bolls have set, but no opened bolls have been reported by local sources. Some counties had passed the effective bloom date, according to industry experts. The focus has shifted from irrigating to maintaining the bolls on the plants. Subsoil moisture was good and not a concern, except for a few fields. Some droughty, dryland stands were in need of rain in localized areas, mainly in the Rolling Plains. Insect populations were light. Beneficial insect populations have increased under the cooler conditions. Trading East Texas A light volume of mostly color 21 and 31, leaf 3, staple 37, mike averaging 44.5, strength averaging 31.8, and uniformity sold for around cents per pound, FOB warehouse (compression charges not paid). A light volume of mostly color 21-41, leaf 4 and better, staple 35 and longer, mike 39-47, strength 2-30, and uniformity sold for around 8.00 cents, same terms as above. A light volume of color mostly 31 and 41, leaf 3 and better, staple 35 and longer, mike averaging 51.1, strength averaging 29.7, and uniformity averaging 81.3 sold for around 7.00 cents, same terms as above. West Texas 4

5 Western Markets Regional Summary Maria Townsend Visalia, CA Desert Southwest (DSW) Spot cotton trading was inactive. Supplies and demand were light. Average local prices were higher. Some producers fixed prices on a moderate volume of bales as ICE December futures trended higher in the period. No domestic mill activity was reported. Foreign mill inquiries were light. Extreme temperatures were in the low 110s in Arizona. Harvesting neared completion in Yuma. Sources reported yields were typical at around 1,500 pounds. Ginning began in the period. Samples were shipped to the Visalia Classing Office. The cotton crop continues to make good progress throughout Arizona. Producers made preparations for defoliation activities. Some producers in the Coolidge area began defoliation. Crop progress was steady under warm, sunny conditions in New Mexico and El Paso, Texas. The crop needed more heat units to mature bolls in eastern New Mexico. Beneficial insects kept cotton pests under control. Some producers applied final irrigations. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local spot prices were lower. Producers made inquiries for 2017-crop contracts. No contracts were signed. No domestic mill activity was reported. Foreign mill inquiries were light. Summer is hanging on, with temperatures in the high 100s. An excessive heat warning was issued for the Valley. Bolls were cracking open. The crop is making good progress and is about a month from defoliation activities. Producers prepared equipment for harvesting. Gin repairs continued. American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were steady. Producers made inquiries for 2017-crop contracts. No contracts were signed. No forward contracting or domestic mill activity was reported. Daytime temperatures in the high 100s to low 110s were prevalent in Arizona and California. The crop made excellent progress in Arizona, California, and Texas. Harvesting neared completion in Yuma, Arizona. Average yields were reported. No ginning was reported. Ginning was expected to begin after Upland ginning was completed. Local experts reported the Safford Valley crop in Arizona made excellent progress. Bolls were cracking open. The crop was considered to be about a week behind schedule in the San Joaquin Valley. Sources reported more heat units were needed in some New Mexico locales. No significant insect pressures were reported. Overall, the crop made good progress. Trading Desert Southwest A light volume of 2017-crop Arizona cotton for color 21, leaf 2, and staple 3 was fixed at around 250 points on ICE December futures. A moderate volume of 2017-crop Arizona cotton for color 31 and better, leaf 3 and better, and staple 35 and longer was fixed at around 200 points on ICE December futures. San Joaquin Valley American Pima 5

6 World market prices for upland cotton, in cents per pound, in effect from 12:01 a.m., EDT, Friday through midnight, EDT, Thursday Description and July 28 August August August August August Sept 1-7 Adjusted world price 1/ Course count adjustment Fine count adjustment Fine count adjustment Loan Deficiency Payment (LDP) / 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 New sales Buy-backs and cancellations Week Mkt. Year Week - 3,54, ,100 82,200 15,300-4,228, ,00-234,300 3,400-3,00 Net sales 309, ,700 - Sales next marketing year Through August 25, ,900 39,00 2,400 Through August 24, 2017 Mkt. Year 5,945,500 92,500,38,000 Net sales of 230,700 RB for 2017/2018 were reported for Vietnam (58,500 RB, including 200 RB switched from Japan and 200 RB switched from Taiwan), China (54,200 RB), Turkey (31,200 RB), Indonesia (19,400 RB, including 300 RB switched from Japan), Thailand (18,700 RB, including 400 RB switched from Japan), and South Korea (9,900 RB). Reductions were reported for Japan (2,300 RB). For 2018/2019, net sales of 2,400 RB were reported for Guatemala (8,800 RB), Pakistan (8,800 RB), and Vietnam (8,800 RB). Exports of 15,300 RB were primarily to Vietnam (32,500 RB), China (27,000 RB), Turkey (20,300 RB), Mexico (18,800 RB), and Indonesia (14,500 RB). Net sales of Pima totaling 8,900 RB for 2017/2018 were reported for China (5,500 RB), Indonesia (2,000 RB), Japan (700 RB), and Peru (300 RB). Exports of 1,800 RB were to India (1,000 RB), Egypt (400 RB), Portugal (300 RB), and Bangladesh (100 RB). Optional Origin Sales: For 2017/2018, the current optional origin outstanding balance of 7,900 RB is for Indonesia. Exports for Own Account: New exports for own account totaling 17,800 RB were reported for Vietnam (11,400 RB), Indonesia (5,100 RB), and China (1,300 RB). Exports to Vietnam (3,300 RB) and China (1,300 RB) were applied to new or outstanding sales. The current outstanding balance of 8,200 RB is for Indonesia (50,400 RB), Taiwan (13,100 RB), Vietnam (12,200 RB), India (3,800 RB), Bangladesh (2,800 RB), South Korea (2,100 RB), China (1,300 RB), and Pakistan (500 RB) ,200 Source: Export Sales Reporting Division, Foreign Agricultural Service, USDA. NOTE: Data may not add due to rounding. August 31, 2017 USDA ANNOUNCES SPECIAL IMPORT QUOTA #19 FOR UPLAND COTTON August 31, 2017 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 September 07, 2017, allowing importation of 12,751,474 kilograms (58,5 bales) of upland cotton. Quota number 19 will be established as of September 07, 2017, and will apply to upland cotton purchased not later than December 05, 2017, and entered into the U.S. not later than March 05, The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period April 2017 through June 2017, 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 Number of Bales in Certificated Stocks Delivery Points Stocks as of Awaiting Review Non-Rain Grown Cotton Dallas/FT. Worth, TX 3, Galveston, TX 1, Greenville, SC Houston, TX Memphis, TN 3, Total 9, 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 Base Base & above & above August 31,

8 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 February 3, / Pima spot quotations for color-leaf-staple combinations not quoted will be included as sales of those qualities which are reported. Range & Above Level Prep Other (Grams per Tex) Range Mike Diff. 2 & Below Strength & Above & Below Diff Extraneous Matter Diff. August 31,