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DTN Closing Cotton 11/07 13:36
Cotton Keels Over
The cotton market was materially lower Friday.
Keith Brown
DTN Contributing Cotton Analyst
The cotton market was materially lower Friday amid the pressure of
December's option expiration, continued fund rolling, and poor economic numbers
from China.
The University of Michigan survey was released Friday and it revealed the
worst consumer sentiment in three years. The Index of Consumer Sentiment posted
a reading of 50.3 for the month, indicating a decline of 6.2% on the month and
about 30% from a year ago.
Chinese exports contracted in October, down 1.1% from a year ago. Slowing
global demand failed to make up for lost shipments to the U.S. Although
shipments to all nations outside the U.S. rose 3.1%, it was not enough to
offset the 25.0% decline in the U.S. Most had forecasted a 2.9% overall gain in
October Chinese exports.
December contract will expire at the close Friday of the ICE futures. Their
expiration will affect the market's total open interest levels.
USDA has announced it will release an updated crop report on Nov. 14, even
in the face of a continued government shutdown. On the last published WASDE,
prior to the shutdown, USDA had increased the U.S. 2025 cotton crop to 13.22
million bales versus the previous 13.21 million bales.
December cotton will enter its delivery on Nov. 21. Thus all traders, except
those intending to participate in the notice process, will have to liquidate or
roll forward in time.
For Friday, December 2025 ended at 63.62 cents, down 92 points, while March
2026 closed at 65.14 cents, down 63 points. Friday's estimated volume was
115,682 contracts.
Keith Brown can be reached at commodityconsults@gmail.com
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