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DTN Closing Cotton 01/29 13:30
Is Cotton Tethered to Gold?
The cotton market felt and looked strong early on as gold was posting
all-time highs.
Keith Brown
DTN Contributing Cotton Analyst
The cotton market felt and looked strong early on as gold was posting
all-time highs. However, at mid-session, when the precious metals experienced a
wild and massive correction, that negative influence cut across to cotton and
other agricultural markets, which immediately moved down.
Highlights from today's weekly export sales showed slightly weaker sales,
but the participation of countries was broad with 22 listed buyers. USDA's
report showed net sales of 203,666 bales for the current marketing year and
14,964 bales for 2026/2027, for a total of 218,630 bales. This amount was down
from 438,392 bales the previous week and 349,844 bales the week before.
Cumulative sales have reached 67% of USDA's forecast versus a five-year average
of 82% for this point in the marketing year. Shipments of 257,036 bales
constituted a marketing-year high level.
Friday at 3:30 p.m. EST, the CFTC will issue its weekly Commitment of
Traders Report. Last week held that the managed-money funds had net sold some
1,500 positions, increasing their net-short carry to 52,000 contracts.
Interestingly, cotton's open interest has swelled to a record high of 360,000
positions.
The U.S. government may be heading for another partial shutdown on Jan. 30.
The death of another Minnesota person by federal agents this past weekend is
unifying the Democrats in Congress to halt the funding of the DHS budget.
However, most funding for Homeland Security, some $29 billion, has already been
approved.
March options will expire on Feb. 6, one week from Friday. Traders will be
anticipating what amount of Puts and Call may expire "in-the-money".
The latest drought information shows the U.S. cotton planted area at 83%
drought (varying stages). The recent winter storm, Fern, may have improved soil
conditions in some areas.
For Thursday, March 2026 went out at 63.48 cents, 25 points lower; July was
67.01 cents, down 9 points; and December 2026 closed at 68.98 cents, minus 3
points. Thursday's estimated volume was 56,386 contracts.
Keith Brown can be reached at commodityconsults@gmail.com
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