Cotton futures finished with a triple-digit gain in spot December Friday, to close above highs of the previous five sessions. December settled up an even 100 points to 63.32 cents, its highest close since October 21, 2015 and near the high of the session’s 108-point range from 62.36 to 63.44 cents. It gained 56 points for the week and 288 points or 4.8 per cent for the month. March closed up 79 points to 63 cents.
Experts feel that concerns about the cumulative effects of rains on open cotton in the West Texas Plains may have contributed to the advance. Most of the Texas cotton remaining on the stalk is in the high and rolling plains. Volume increased to an estimated 25,600 lots from 22,457 lots the previous session when spreads accounted for 12,463 lots or 56 per cent, EFS 1,000 lots and EFP 70 lots. Options volume totalled 2,654 calls and 2,079 puts. Index fund rolling from December has begun, with the Goldman Sachs roll scheduled to begin next Friday. First notice day for December deliveries is November 23, 2015.
US upland cotton classing increased to 904,417 running bales during the week ended Thursday from 805,581 bales the previous week to boost the total for the season to 2,918,943 RB, compared with 3,900,444 RB a year ago, according to the latest USDA figures. The total amounted to about 23 per cent of USDAʼs upland crop estimate. Tenderable cotton improved to 59 per cent from 57.5 per cent the previous week and rose to 58.1 per cent for the season from 57.7 per cent. A year ago, 73.6 per cent classed for the season met tenderable standards.
Pima classing of 1,602 bales boosted the extra-long staple total for the season to 32,169 bales, down from 59,701 bales graded through the corresponding period last year. On the competitive-pricing front, the average of the five lowest-priced world growths for the Far East fell 123 points to 66.89 cents during the week ended Thursday, according to USDA calculations, while the lowest-quoted US cotton landed there slipped 110 points to 73.30 cents.
The spread thus narrowed 13 points to 6.41 cents. The adjusted world price for the program week ahead is 47.14 cents, down from this weekʼs 48.37 cents, USDA announced, resulting in the marketing loan gain rising to 4.86 cents from 3.63 cents. The fine count adjustment for qualities better than 31-3-35 is 96 points. Meanwhile, unfixed on-call positions based in December declined 808 lots to 12,705 on the mill side and 606 lots to 7,990 on the producer side last week, according to Commodity Futures Trading Commission data.
The net call difference declined 202 lots to 4,715, which was 4.01 per cent of the declining December open interest. The unfixed mill position outweighed that of producers by a ratio of 1.59:1. Mills added 1,246 lots in March and producers added 165 lots. As reported by Dow Jones Newswires, trading in the Intercontinental Exchangeʼs new world cotton futures contract will begin Sunday night alongside its U.S. cotton No. 2 contract. The world contract will trade under the symbol WCT. An ICE announcement said the world contract is not likely to replace the US contract but will have a “smaller, complementary role.”
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