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DTN Closing Cotton 02/27 13:32
Cotton Eyes Approaching Spring
The cotton market ended the month of February on a positive, albeit a small
note.
Keith Brown
DTN Contributing Cotton Analyst
The cotton market ended the month of February on a positive, albeit a small
note. For all of its ups and downs, the ICE futures closed out some 77 points
higher on the month. However, the month of March should unfold different and
influential news. One immediate concern is that the U.S. cotton planted area
has now swelled to 84% dry-to-drought conditions.
Today at 3:30 p.m. EST, the CFTC will issue its weekly Commitment of Traders
report. At last count, the managed-money funds had net sold some 3,900
contracts, swelling their current bearish position to 79,508 contracts. For
context, their record high negative carry from last October, stands at 81,343
contracts.
U.S. cotton sales have been consistently above 200,000 bales for six
straight weeks and above 300,000 in four of the last six, which is much better
than where they were up until then. However, cumulative sales are still at
their lowest level in 11 years, and they have only reached 75% of the USDA
forecast versus a five-year average of 88% for this point in the season as of
last week.
The U.S. dollar eased today despite the hotter-than-expected PPI (producer
price index) for January, and on the rising tensions between the U.S. and Iran.
The Producer Price Index rose 0.5% last month after advancing 0.4% in December.
For Friday, July closed at 67.32 cents, up 25 points; December 2026 closed
at 69.70 cents, plus 25 points; and March 2027 finished at 70.64 cents, 29
points lower. Friday's estimated volume was 43,971 contracts.
Keith Brown can be reached at commodityconsults@gmail.com
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