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. 100 No. 3 August 17, 2018 Inside this Issue Market Overview Price Support Average quotations were 492 points lower 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 , and uniformity ) in the seven designated markets averaged cents per pound for the week ending Thursday, August 1, The weekly average was down from 84.2 last week, but up from 5.91 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of cents Friday, August 10 to a season low of cents Wednesday, August 15. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended August 1 totaled 2,999 bales. This compares to 4,113 reported last week and 4,904 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 7,30 bales compared to 10,555 bales the corresponding week a year ago. The ICE October settlement prices ended the week at cents, compared to 87.2 cents last week. Spot Quotations ICE Futures A Index Southeastern Textile Mill Report South Central Southwestern Western Cotton & Wool Pima Quotations 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 lower. Trading of CCC-loan equities was inactive. Fair to partly cloudy conditions were observed across the lower Southeast region during the period. Daytime high temperatures were in the upper 80s to low 90s throughout the week. Scattered thundershowers brought moisture to areas from the Gulf to Atlantic coasts. In south Alabama, south Georgia, and the Florida panhandle, day-to-day shower activity brought around one to one and one-half inches of weekly accumulated precipitation to localized areas. Producers welcomed the beneficial rainfall in areas of Alabama where dry conditions were observed. Insect pressure was generally light; some fields were treated where foliage feeders met threshold levels. In Georgia, target spot disease had spread in areas where damp conditions persisted. Adult whiteflies were also present in some fields. Similar weather conditions were observed across the upper Southeastern region throughout the period. Daytime high temperatures were observed in the mid-80s to low 90s. Widespread shower activity brought moisture to areas throughout North Carolina and portions of eastern South Carolina and Virginia. Weekly accumulated precipitation totals measured from one-half of an inch to two inches, with heavier accumulations observed in localized areas. Continued rainfall over the last couple of weeks has prevented producers from applying growth-regulators in some fields and there is concern that yields will be negatively impacted. Weed pressure has also increased in areas where herbicide applications have been delayed. Insect pressure was generally light. In areas where populations met threshold limits, producers treated fields where soils were firm enough to support equipment. Bolls were cracking open in the earliest-planted fields across the region. According to the National Agricultural Statistics Service s Crop Progress report released August 13, boll-setting had reached 89 percent in Alabama, 84 in Georgia, 78 in North Carolina, 75 percent in South Carolina and Virginia. Textile Mill Demand was good for color 41, leaf 4, and staple 34 for fourth quarter 2018 through first quarter 2019 delivery. No additional sales were reported. Demand of open-end and ring-spun yarn was moderate. Most mills operated five to seven days. Demand through export channels was moderate. Agents throughout the Far East inquired for any discounted styles of cotton. No sales were reported. Trading 2

3 Southeastern Markets Regional Summary Danny Pino Macon, GA Photos courtesy of: Danny Pino, Southeast Reporter 3

4 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 lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. Hot and humid weather prevailed throughout the region during the week. Daytime high temperatures were in the upper 90s, with a reported heat index of 102. Overnight lows were in the upper 70s. A series of storms brought several inches of rain to northeastern Arkansas and the cotton-producing region of Missouri mid-to-late week. Locally heavy downpours resulted in up to 5 inches of rain in some places. Only trace amounts of precipitation were reported in Tennessee, which caused the condition of the cotton crop to decline somewhat compared to last week. Some boll shedding was reported in drier areas. Crop protection measures have been terminated on dryland cotton and early-planted fields under irrigation. Some late-planted fields continued to receive treatments as necessary, due to pressure from insect pests including plant bugs, bollworms, and spider mites. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released August 13, the crop condition in Arkansas improved slightly to 84 percent good-to-excellent. Missouri also improved slightly to 79 percent fair-to-good, while Tennessee declined 8 points to 74 percent good-to-excellent. NASS also reported that open bolls were at 7 percent in Arkansas, 2 percent in Missouri, and 8 percent in Tennessee. Defoliation could begin within one to two weeks, staring with dryland fields. South Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. Fair weather conditions allowed the crop to make normal progress during the week in most areas. Daytime high temperatures were in the mid-90s. Overnight lows were in the low 70s. Pop-up thunderstorms brought 1 to 2 inches of rain to widely scattered areas. Producers continued irrigating as necessary to maintain adequate soil moisture on late-planted fields. Boll shedding was reported in moisture-stressed fields. Insect pressure was light and fields were treated to control pests; many fields no longer required any crop protection measures. According to the National Agricultural Statistics Service s (NASS) Crop Progress report released August 13, the crop condition in Louisiana was rated at 92 percent fair-to-good and in Mississippi 73 percent fair-to-good; these figures were slightly lower than those reported the previous week. NASS also reported that open bolls had reached 12 percent in Mississippi and 29 percent in Louisiana; defoliation could begin within a week to ten days. Trading North Delta South Delta 4

5 Southwestern Markets Regional Summary Jane Byers-Angle Lubbock, TX East Texas Spot cotton trading was moderate. Supplies and producer offerings were light. Demand was light. Average local spot prices were lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Defoliants were applied and harvesting progressed under good conditions in south Texas. More than half of the fields have been harvested in the Coastal Bend. Harvesting has been completed in some counties except on late-planted fields. Harvesting expanded in the Upper Coast. Ginning continued in the Rio Grande Valley. Untimely rainfall was received on some fields that were ready for harvest in the northern Blackland Prairies, where producers had already applied defoliants. Reports indicated that 7 to 12 inches of rainfall was received and field activity was hindered. Drier conditions prevailed in the southern Blackland Prairies, and defoliants and boll openers were applied. According to the National Agricultural Statistics Service s (NASS) Texas Production report released on August 10, production in the Blackland Prairies is forecasted at 10,000 bales, compared to 293,000 bales produced the previous year. Acres harvested are estimated at 215,000 acres, compared to 15,000 acres last season, and estimated yield is at 357 pounds per acre, compared to 85 pounds per acre in According to NASS s Crop Production report released on August 10, Kansas cotton production is forecasted at 250,000 bales, up 27 percent from the previous year. Acreage harvest is forecasted at 11,000 acres, up 2,000 acres from Yield is forecasted lower at 1,034 pounds per acre, down 17 pounds per acre. Bolls had begun to open. Moderate, timely rainfall helped the crop advance. Recent rainfall in Oklahoma helped the irrigated stands, and producers were encouraged. Some fields reached Dryland continued to struggle. cut-out. West Texas Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was very light. Average local spot prices were lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was slow. Foreign inquiries were light. Daytime temperatures were mostly in the mid-80s to low 90s. A series of timely thunderstorms early in the reporting period brought beneficial rainfall and cooler conditions, which gave heat-stressed plants a reprieve. The rainfall was received too late for many dryland acres that have already been submitted for coverage under the federal crop insurance program. Irrigated fields reached full-bloom, and some neared cut-out. Plants were loaded and fruit retention was good. Stands in the western panhandle and in New Mexico have enough well water and made good progress. Beneficial rainfall was received. Local experts continued to monitor fields for insect activity. Trading East Texas In Texas, a light volume of new-crop cotton color 21 and 31, leaf 3 and better, staple 3 and longer, mike 44-48, strength 28-30, and uniformity sold for around cents per pound, FOB warehouse (compression charges not paid). In Kansas, a mixed lot containing a moderate volume of 2017-crop cotton mostly color 33 and better, leaf 5 and better, staple 3 and longer, mike 35-47, strength 29-32, uniformity 80-83, and 25 percent extraneous matter sold for around 7.50 cents, FOB car/truck (compression charges not paid). A mixed lot containing a light volume of mostly color 85, leaf 7 and better, staple 32 and longer, mike 31-42, strength 25-31, uniformity 7-81, and 75 percent extraneous matter sold for around cents, same terms as above. West Texas A moderate volume of CCC-loan equities traded for 3.75 to 7.75 cents per pound. 5

6 Southwestern Markets Regional Summary Jane Byers-Angle Lubbock, TX Photos courtesy of: Dwight Jackson

7 Maria Townsend Western Markets Regional Summary Visalia, CA Desert Southwest (DSW) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light and mostly for new-crop price discovery. Temperatures were in the low 100s, with approximately one-half of an inch of rainfall received early in the period. Harvesting gained momentum in Yuma. Modules lined the fields and were transported to the gin. According to the National Agricultural Statistics Service (NASS) Crop Progress report for week ending August 12, boll-setting reached 91 percent and 25 percent of bolls were opened. The condition of the crop was rated mostly fair-to-good. Some central Arizona fields were treated to control lygus and whitefly. Evidence of Level 2 heat stress was present in some fields and a few young immature bolls were shed. Squaring advanced to 85 percent in New Mexico. Boll-setting was at 52 percent, compared to the five-year average of 4 percent, according to NASS. The condition of the crop was rated mostly fair-to-good. Monsoon moisture brought one-half of an inch to nearly one inch of much needed moisture early in the reporting period for New Mexico and El Paso, TX. Local sources reported that the crop made good progress. The organic crop in New Mexico made good progress. The crop has responded well to the heat. No insect pressure was reported. light. No inquiries for new-crop were reported. Sunny skies and hot temperatures ruled. Daytime high temperatures were in the high 90s to low 100s. Conditions improved as fire crews contained nearby wildfires. Fields were sprayed for aphid and lygus. The crop was in good condition and made good progress. The California State Department of Ag. Pink Bollworm program issued the final Upland cotton acreage mapped at 33,990 acres in the SJV. A statewide total of 47,925 Upland acres was reported. American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were steady. No domestic mill activity was reported. Foreign mill inquiries were light for 2018-crop cotton. Daytime temperatures were in the high 90s to low 100s for the Far West. The Far West crop continued to make good progress under hot, dry conditions. Harvesting gained momentum in Yuma, AZ. Ginning was set to begin after the Upland cotton ginning is completed. Blooming continued and boll-setting advanced throughout the region. Overall, the crop was in good condition. The California State Department of Ag. Pink Bollworm program issued the final cotton acreage mapped at 209,945 acres of AP cotton in the SJV. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were Trading Desert Southwest San Joaquin Valley American Pima 7

8 Cotton & Wool The following information was excerpted from the Cotton & Wool report, released on August 14, 2018 The latest U.S. Department of Agriculture (USDA) estimates indicate that total U.S. cotton textile and apparel trade grew during the first half of 2018, compared with the corresponding period of While U.S. cotton product imports totaled the equivalent of nearly 8.8 million 480-pound bales of raw cotton during January-June 2018 compared with approximately 8. million bales for the first months of 2017 cotton product exports decreased slightly to about 1.8 million bale-equivalents. Based on these volumes, the cotton textile and apparel trade deficit was 3 percent higher at 7.0 million bale-equivalents during the first half of The concentration of U.S. cotton product imports continues to be focused on several major suppliers, with the top five countries contributing more than two-thirds of total imports during the first half of Compared with the corresponding period of 2017, the first months of 2018 saw the share rise for four of the top five suppliers (fig. 1). China remains the leading supplier of U.S. cotton product imports, accounting for nearly 31 percent of the total during January-June of 2018; for India the second largest supplier the share reached 11.5 percent. In addition, the U.S. cotton product import shares increased for Pakistan, Vietnam, and Bangladesh in 2018, with each providing 8 percent of the mid-year total. For complete report click here. 8

9 World market prices for upland cotton, in cents per pound, in effect from 12:01 a.m., EDT, Friday through midnight, EDT, Thursday and July July July 27 Aug Aug Aug Aug Adjusted world price 1/ Course count adjustment Loan Deficiency Payment (LDP) Fine count adjustment Fine count adjustment / 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 Marketing Years Week Mkt. Year Week - 5,815, , , ,300 -,129,00 - New sales 192,00-82,400 - Buy-backs and cancellations 5,900-4,700 - Net sales Sales next marketing year 18,700-77,700, ,900 (11,700) Through August 10, 2017 Through August 9, 2018 Mkt. Year 8,039, ,400 8,322,800-1,31,300 Net sales of 77,700 RB for 2018/2019 were reported for Vietnam (24,00 RB), Pakistan (1,900 RB), Indonesia (7,000 RB, including 1,100 RB switched from Japan), Bangladesh (,100 RB), and Peru (4,00 RB). Reductions were reported for Japan (3,000 RB). For 2019/2020, net sales reductions of 11,700 RB resulted as increases for Mexico (3,500 RB), were more than offset by reductions for India (15,200 RB). Exports of 240,300 RB were primarily to Indonesia (42,700 RB), Vietnam (41,00 RB), China (34,400 RB), Bangladesh (24,700 RB), and Mexico (15,200 RB). Net sales of Pima totaling 2,800 RB for 2018/2019 reported for Vietnam (2,200 RB), India (400 RB, switched from Japan), and the United Kingdom (300 RB), were partially offset by reductions for Japan (300 RB). Exports of 4,00 RB were primarily to India (2,000 RB), Pakistan (1,400 RB), Indonesia (500 RB), and Thailand (300 RB). Optional Origin Sales: For 2018/2019, the current optional origin outstanding balance of,200 RB is for Indonesia (4,400 RB) and Vietnam (1,800 RB). Exports for Own Account: New exports for own account totaling,800 RB were to China. Decreases totaling,800 RB were reported for Vietnam (,300 RB) and Bangladesh (500 RB). The current outstanding balance is 13,000 RB, all China. Source: Export Sales Reporting Division, Foreign Agricultural Service, USDA. NOTE: Data may not add due to rounding. August 1, 2018 USDA ANNOUNCES SPECIAL IMPORT QUOTA #17 FOR UPLAND COTTON August 1, 2018 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 August 23, 2018, allowing importation of 13,543,5 kilograms (2,205 bales) of upland cotton. Quota number 17 will be established as of August 23, 2018, and will apply to upland cotton purchased not later than November 20, 2018, and entered into the U.S. not later than February The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period April 2018 through June 2018, 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. 9

10 Number of Bales in Certificated Stocks Delivery Points Stocks as of Awaiting Review Non-Rain Grown Cotton Dallas/FT. Worth, TX 7, Galveston, TX Greenville, SC Houston, TX Memphis, TN 12, Total 20, 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 Diff Base Base & above & above August 1,

11 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 May 30, Type - Level Plastic - Level 2 Diff. Other - Level Plastic - Level / Pima spot quotations for color-leaf-staple combinations not quoted will be included as sales of those qualities which are reported. Range 2 & Below & Below & Above Extraneous Matter Prep - Level Prep - Level 2 Mike Strength & Above 0 Range (Grams per Tex) Diff Diff Other - Level August 1,