Average spot cotton quotations were 43 points lower than the previous week, according to the USDA, Agricultural Marketing Service’s Cotton Program. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-36 and 4349, strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets averaged 66.05 cents per pound for the week ended Thursday, July 26, 2012. The weekly average was down from 66.48 cents last week, and 105.50 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of 67.08 cents on Friday, July 20 to a low of 64.61 cents on Wednesday, July 25. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended July 26 totaled 7,424 bales. This compares to 9,214 bales last week and 5,010 bales reported a year ago. Total spot transactions for the season were 900,831 bales, compared to 651,473 bales the corresponding week a year ago. The ICE October settlement prices ended the week at 70.68 cents, compared to 71.79 cents last week.
Prices are in effect from July 27-August 2, 2012 Adjustment World Price (AWP) 63.02 ELS Competitiveness Payment 0.00 Loan Deficiency Payment (LDP) 0.00 Fine Count Adjustment 2011 Crop 0.45 Coarse Count Adjustment (CCA) 0.00 Fine Count Adjustment 2012 Crop 0.65 Source: Farm Service Agency, FSA, USDA
USDA ANNOUNCES SPECIAL IMPORT QUOTA #24 FOR UPLAND COTTON July 26, 2012
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 2, 2012, allowing importation of 13,517,512 kilograms (62,085 bales) of upland cotton. Quota number 24 will be established as of August 2, 2012, and will apply to upland cotton purchased not later than October 30, 2012, and entered into the U.S. not later than January 28, 2013. The quota is equivalent to one week’s consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period March 2012 through May 2012, 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.
Regional Summaries
Southeastern Markets
Spot cotton trading was slow. Supplies were light. Demand was moderate. Producer offerings were light. Average local spot prices were lower. Trading of CCC loan equities was inactive. No forward contracting was reported.
Widespread thunderstorms brought moisture to areas throughout the region during the period. Around one-quarter to one-half of an inch of precipitation was received in areas of south Alabama, Georgia, and South Carolina. Heavier amounts of two to five inches of accumulated rainfall were received in areas of eastern North Carolina and Virginia throughout the week. Daytime temperatures were in the high 80s and warmed to the high 90s late week. Heat advisories were issued in many areas as possible heat indexes of 105 to 109 were reported. The crop progressed well under the hot, humid conditions and squaring was virtually completed. Boll-setting was well underway and producers considered mid-season nematode, crop disease, and growth-management decisions. Plant bug, stink bug, and spider mite populations were light and easily controlled in Alabama and Georgia. Local experts reported bollworm activity was negligible. Insect pressure was also light in the Carolinas and Virginia, but producers continued to scout fields and spray areas that met threshold limits. Local consultants reported that some organic acreage was abandoned, due to hail damage and weed infestation in North Carolina.
South Central Markets
North Delta
Spot cotton trading was slow. Producer offerings and supplies were light. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was slow. No forward contracting was reported.
Hot, dry conditions returned in full force during the week. Daytime highs soared into the upper 90s, with heat indexes well into the triple digits. Overnight lows were mostly in the low 70s. Pop-up thunderstorms provided little moisture or relief from the searing temperatures. Rainfall accumulations for the week amounted to a few hundredths of an inch in areas that received any measurable precipitation. The U.S. Drought Monitor expanded the area experiencing exceptional conditions. The National Agricultural Statistics Service estimated that boll setting had reached 92 percent in Arkansas, compared to 31 in Missouri and 55 percent in Tennessee. Crop advisors reported that early-planted and dry- land fields no longer required the application of crop protection chemicals. Some producers treated irrigated cotton with plant-growth regulators to inhibit regrowth following the recent rains. Insect pressure was highly variable. Producers were monitoring fields closely for plant bugs and bollworms. Fields were treated as necessary.
South Delta
Spot cotton trading was slow. Supplies were light. Producer offerings were light. Demand was light. Average local spot prices were lower. Trading of CCC- loan equities was slow. No forward contracting was reported.
Producers welcomed the clear skies and hot temperatures following the recent, but much-needed rain storms. Daytime highs reached the triple digits with overnight lows in the mid 70s. The crop made good progress. The U.S. Drought Monitor showed a small portion of northwestern Mississippi is now experiencing extreme drought conditions. Portions of northeastern Louisiana are experiencing from abnormally dry to moderate drought conditions. According to the National Agricultural Statistics Service, boll setting was estimated at 87 percent in Louisiana and 80 percent in Mississippi. Some dryland and some early-planted, irrigated fields could be defoliated within two weeks. Producers applied plant-growth regulators to some irrigated fields. Fields were treated for bollworms and plant bugs as necessary.
Southwestern Markets
East Texas-Oklahoma
Spot cotton trading was slow. Supplies were moderate. Demand was light. Average local spot prices were firm. Producer offerings were light. No forward contracting was reported. Trading of CCC-loan equities was slow. Foreign mill interest was light.
In Texas, harvesting expanded in the Rio Grande Valley and Coastal Bend. Some fields that failed to develop boll loads were shredded following the crop adjusters’ determination. Irrigated fields advanced. Some light rainfall was received in localized areas that helped to alleviate heat stress.
The first Daily Cotton Quality Summary and Weekly Cotton Quality reports for the 2012 crop were released on July 27. For the week ending July 26, the Corpus Christi Classing Office had graded 15,632 samples. The weekly report showed color grade 31 was the predominate color grade, and leaf grade 3 was the predominate leaf grade. Staple length averaged 33.5, mike averaged 4.3, strength average 28.6, and uniformity averaged 80.4. Complete quality reports can be found at http:www.ams.usda.gov/cnmnreports or http://marketnews.usda.gov/portal/cn.
In Kansas, irrigated fields advanced, but some wells were dry as the crop approached peak water use. Most of the dryland was expected to be lost due to hot, dry conditions; producers waited for crop adjusters to make the final determination. In Oklahoma, irrigated fields advanced, but suffered around the southwestern part of the state that was managed as dryland acreage, due to the low lake level. The irrigated fields were mostly around peak bloom. Dryland cotton exhibited more variance depending on date planted.
West Texas
Spot cotton trading was slow. Supplies were moderate. Demand was very light. Average local spot prices were firm. Producer offerings were light. No forward contracting was reported. Trading of CCC-loan equities was slow. Foreign mill inquiries were light.
Widespread thunderstorms brought light to moderate general precipitation that helped the crop progress. Hot, sunny conditions prevailed during the week with daytime temperatures in the high 90s to low 100s. Fields that missed the rainfall struggled under excessive heat. Producers applied fertilizer and managed weed populations with a focus on pigweed. Insect populations were light, but producers monitored for the presence of aphid, bollworm, and lygus. Beneficial insect populations increased in some areas that helped naturally control aphid problems; no chemical applications were necessary. Generally, infestations were managed without treatments across the region, but major pests had begun to enter the fields since the cotton was blooming. Producers considered plant-growth regulator applications in some fields.
Western Markets
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 for prompt shipment.
The crop advanced rapidly towards cut-out in Yuma, Arizona. The crop made good progress in central and eastern Arizona. Monsoons were active early in the period. Dust storms with isolated rainfall occured in Arizona. Cloudy, breezy conditions were prevalent in cotton-growing areas of New Mexico and El Paso, Texas. Due to monsoon activity and availability of additional water supplies, on July 11, the Elephant Butte Irrigation District approved an increase to the irrigation allotment of 4 inches. This additional allotment brings the season total to 10 inches.
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 light and for prompt shipment.
Temperatures were in the low 100s, with humid and cloudy conditions early in the period. Overall, the crop made good progress. County agents advised producers on managing late-season growth. Insect pressure remains light.
American Pima (AP)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local prices were steady. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were sporadic and for prompt shipment. No new sales were reported.
Early-planted fields in Yuma, Arizona were approaching cut-out. Monsoon activity brought beneficial isolated rainfall to the Desert Southwest (DSW). The crop made good progress throughout the far west. Insect pressures were light and easily controlled.
Textile Mill
Domestic mill buyers inquired for a moderate volume of color 41, leaf 4, and staple 34 for September fill-in needs. Mill buyers also inquired for a moderate volume of 2012-crop cotton, color 41, leaf 4, and staple 34 for third quarter 2012 and first quarter 2013 delivery. No sales were reported. Demand for open-end and ring-spun yarn was moderate. Most mills operated on a five to seven day schedule. Some mills planned downtime for routine maintenance; production recommenced at other mills that had been idled to manage building inventories.
Inquiries through export channels were moderate. Taiwanese mill buyers purchased a moderate volume of USDA Green Card Class, color 31, leaf 3, and staple 35 for prompt shipment. Representatives for mills in Taiwan also inquired for a moderate volume of color 42, leaf 5, and staple 33 and longer for August/ September shipment. Demand was best throughout the Far East for any discounted or low-grade styles of raw cotton.
Regional Price Information
Southeastern Markets
Mixed lots containing color mostly 41 and 51, leaf 3-6, staple 32 and longer, mike 52 and higher, strength 28-31, and uniformity 79-81 sold for around 60.00 cents per pound, FOB car/truck (Rule 5, compression charges paid).
South Central Markets
North Delta
A light volume of color 41 and better, leaf 5 and better, staple 33 and longer, mike 36-44, strength 27-31, and uniformity 79-82 sold for around 69.50 cents per pound, FOB car/truck (Rule 5, compression charges paid).
A light volume of CCC-loan equities traded for around one-quarter of a cent.
South Delta
A light volume of mixed lots containing mostly color 52 and better, leaf 5 and better, staple 34 and longer, mike 35-54, strength 26-32, uniformity 78-83, with 100 percent extraneous matter (seed coat fragments) traded for around 58.00 cents per pound, FOB car/truck (Rule 5, compression charges paid).
A moderate volume of CCC-loan equities traded for around one cent.
Southwestern Markets
East Texas
In Oklahoma, a light volume of mixed lots containing color 42 and better, leaf 2 and 3, staple 33 and 34, mike averaging 44.4, strength averaging 29.2, and uniformity averaging 80.0 sold for around 60.50 cents per pound, FOB car/truck (compression charges not paid).
In Texas, a light volume of color 11, leaf 2, staple 32, mike 43-49, strength 26-28, and uniformity 78-80 sold for around 61.00 cents, FOB warehouse (compression charges not paid).
A light volume of color 31 and better, leaf 3 and better, staple 31, mike 36-52, strength averaging 25.5, and uniformity averaging 79.0 sold for around 59.75 cents, same terms as above.
West Texas
A moderate volume of color 41 and better, leaf 4 and better, staple 32 and longer, mike 30-52, strength 29-33, and uniformity 80-81 sold for around 61.50 cents per pound, FOB car/truck (compression charges not paid).
Mixed lots containing color mostly 22, leaf 2 and 3, staple 36 and longer, mike 29-38, strength averaging 31.5, uniformity 79-82, with 25 percent extraneous matter (bark) traded for around 60.00 cents, same terms as above.
A light volume of CCC-loan equities traded for four to eleven cents.
Western Markets
Desert Southwest
No trading activity was reported.
San Joaquin Valley
No trading activity was reported.
American Pima
No trading activity was reported.
Source: U.S. Department of Agriculture
