Average spot cotton quotations were four and one-half cents higher than the previ¬ous week, according to the USDA, Agricultural Marketing Service’s Cotton Pro¬gram. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-36 and 43-49, strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets averaged 70.66 cents per pound for the week ended Thursday, August 9, 2012. The weekly average was up from 66.13 cents last week, but down from 99.13 cents reported the corresponding period a year ago. Daily average quota¬tions ranged from a low of 68.91 cents on Friday, August 3 to a high of 71.42 cents on Thursday, August 9. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended August 9 totaled 9,575 bales. This compares to 12,262 bales last week and 838 bales reported a year ago. Total spot transactions for the season were 11,963 bales, compared to 942 bales the corresponding week a year ago. The ICE October settlement prices ended the week at 75.59 cents, com¬pared to 70.44 cents last week.
Prices are in effect from August 10-16, 2012 Adjustment World Price (AWP) 64.14 ELS Competitiveness Payment 0.00 Loan Deficiency Payment (LDP) 0.00 Fine Count Adjustment 2011 Crop 0.86 Coarse Count Adjustment (CCA) 0.00 Fine Count Adjustment 2012 Crop 1.06 Source: Farm Service Agency, FSA, USDA
USDA ANNOUNCES SPECIAL IMPORT QUOTA #26 FOR UPLAND COTTON August 9, 2012
The Department of Agriculture’s Commodity Credit Corporation announced a spe¬cial 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 16, 2012, allowing importation of 13,516,971 kilograms (62,083 bales) of upland cotton. Quota number 26 will be established as of August 16, 2012, and will apply to upland cotton purchased not later than November 13, 2012, and entered into the U.S. not later than February 11, 2013. The quota is equivalent to one week’s con-sumption of cotton by domestic mills at the seasonally-adjusted average rate for the period April 2012 through June 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 higher. Trading of CCC-loan equities was slow. No forward contract¬ing activity was reported. Producers took advantage of higher ICE futures during the period to fix prices on a moderate volume of previously contracted 2012¬crop cotton.
Scattered thunderstorms brought rainfall to cotton growing areas throughout the region during the peri¬od. Weekly accumulated rainfall totals measured one to three inches. Daytime high temperatures in the low 90s moderated by late week into the mid-to-high 80s. The crop progressed well and boll-setting advanced. Bolls were beginning to crack open in the earliest planted fields in Alabama, Georgia, and North Caroli¬na, according the NASS Crop Progress report. Corynespora leaf spot disease had developed in some areas that have received consistent moisture in recent weeks. Producers sprayed infected fields with fungi¬cide, but daily rainfall patterns made applications dif¬ficult. Insect pressure was variable; plant and stink bug populations had flared in locales throughout the region and producers treated fields. Spider mite infes¬tations were variable, fields were sprayed that met threshold limits. Tobacco budworm moths were re-ported in fields in south Alabama and Georgia.
South Central Markets
North Delta
Spot cotton trading was inactive. Producer offerings and supplies were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was slow. A few producers took advantage of the upswing in the market and fixed prices on previ¬ously contracted cotton.
The region experienced slightly cooler tempera¬tures, but conditions remained dry during the week. Daytime highs were mostly in the low 90s. Overnight lows were mostly in the upper 60s to low 70s. No measurable precipitation was reported. The Secretary of Agriculture designated nearly all of the cotton-producing counties in the region as primary disaster areas, due to the expanding drought conditions, mak¬ing them eligible for Emergency loans. Producers continued to irrigate at full capacity, resulting in that portion of the crop making good progress. The Na¬tional Agricultural Statistics Service estimated that boll opening had reached 4 percent in Arkansas. No open bolls were reported in Missouri or Tennessee. Producers continued monitoring irrigated fields for spider mites and bollworms; treatments were made as necessary, mainly for plant bugs.
South Delta
Spot cotton trading was slow. Supplies were light. Producer offerings were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward con¬tracting was reported.
Hot temperatures persisted as daytime highs re¬mained mostly in the high 90s with overnight lows in the mid 70s. No rainfall was reported. The Secretary of Agriculture designated several of the cotton-producing counties in northern Mississippi and a num¬ber of parishes in north-central Louisiana as primary disaster areas, making them eligible for Emergency loans. The main production areas in central Missis¬sippi and in the Louisiana parishes bordering Missis¬sippi have benefitted from more precipitation this sea¬son than the surrounding areas. Producers in those areas anticipate making average yields. According to the National Agricultural Statistics Service, boll open¬ing was estimated at 9 percent in Louisiana and 3 per¬cent in Mississippi. No defoliation was reported. Irri¬gated fields were monitored for bollworms, spider mites, and plant bugs and were treated as necessary.
Southwestern Markets
East Texas-Oklahoma
Spot cotton trading was slow. Supplies were moder¬ate. Demand was light. Average local spot prices were higher. Producer offerings were moderate. No forward contracting was reported. Trading of CCC loan equities was slow. Foreign mill inquiries were moderate. Interest was best from Korea, Mexico, and Thailand.
Producers in central Texas, the Upper Coast, and the Winter Garden areas prepared for harvesting and transported equipment to the fields. Defoliants were applied to early-planted acreage. Central Texas gins began operations to process the first bales of their region. Final harvesting activities, including shredding and plowing of harvested fields were underway in the Rio Grande Valley and south Texas. In Kansas, bolls had begun to crack open, but the crop deteriorated because of a lack of moisture and excessively high temperatures. In Oklahoma, wildfires ravaged agricultural structures as the drought expanded. The crop continued to deteriorate under hot conditions. Intermittent rain showers brought trace amounts to three-quarters of an inch precipitation late in the week, which helped advance some fields.
West Texas
Spot cotton trading was moderate. Supplies and demand were moderate. Average local spot prices were higher. Producer offerings were light. No forward contracting was reported. Trading of CCC-loan equities was moder¬ate. Foreign mill inquiries were moderate. Interest was best from Korea, Mexico, and Thailand.
Widespread showers brought moderate rainfall to some areas mid-week that helped progress irrigated and the surviving dryland fields. The precipitation came too late for some dryland acreage that has been claimed under crop insurance regulations because of low yield potential and poor development. Irrigated fields with adequate water supply advanced and established a foundation for a good boll load. Hot, sunny conditions continued to stress cotton plants with daytime highs in the upper 90s to low 100s. Insect populations increased and treatments were applied as needed.
Western Markets
Desert Southwest (DSW)
Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were higher. No forward contracting or domestic mill activity was reported. Inquiries for new-crop contracting increased as ICE December futures climbed higher. Foreign mill inquiries were light.
Triple digit temperatures were prevalent in Arizona. Daytime highs were over 110 degrees in the period. Heat unit accumulations were ahead of normal in western Arizona. Open bolls were reported in fields along the Colorado River. The National Agricultural Statistics Service reported 15 percent of AZ acreage had open bolls. Defoliation continued in Yuma. Local experts reported low water levels in eastern Arizona and some wells were dry. Cotton-growing areas of New Mexico and El Paso, Texas benefitted from monsoon activity. Scattered showers kept streams flowing and replenished sub-soil moisture. Some fields around Carlsbad, NM and Hud¬speth County, TX were suffering from lack of water or high salinity levels in well water. No open bolls were sighted. Overall, the crop made good progress in the DSW.
San Joaquin Valley (SJV)
Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were higher. Pro¬ducer interest in 2012-crop contracting increased as ICE December futures reached the 75.00 cents level. No do¬mestic mill activity was reported. Foreign mill inquiries were light.
Triple-digit temperatures prevailed. Hot conditions increased insect pressures in the Valley. Treatments were made for aphids, lygus, mites, and whitefly. Producers irrigated to combat heat stress. The crop was in good-to¬excellent condition. Open bolls were sighted in Kern County. Some early-planted fields had approached the cut¬out stage.
American Pima (AP)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local prices were steady. No forward contracting was reported. Foreign mill inquiries increased. New sales of 2011-crop cotton were re¬ported. Interest was best from China, India, and Pakistan.
The heat wave continued in the far west. Temperatures in Arizona reached over 110 degrees and in the mid¬100s for the San Joaquin Valley. Producers irrigated fields to manage heat stress of plants. Defoliation continued in Yuma, Arizona. The crop made good progress in the San Joaquin Valley. Local experts reported that boll set¬ting was good and the top crop was progressing well. Sources indicated that this crop had the potential for high yields. Insect pressures increased with the heat, but were easily controlled.
Textile Mill
Domestic mill buyers inquired for light volume of color 41, leaf 4, and staple 34 for nearby fill-in needs. Mill buyers also inquired for a light 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. The undertone from mill buyers was cautious as they at¬tempted to gauge raw cotton needs entering 2013. Most mills operated on a five-to-seven day schedule.
Turkish mill buyers inquired for a moderate volume of USDA Green Card Class, color 41, leaf 4, and staple 36 for prompt shipment. Representatives for mills in South America inquired for a moderate volume of color 31, leaf 3, and staple 36 for October shipment. Demand also remained good throughout the Far East for any discount¬ed or low-grade varieties.
USDA Announces No Marketing Quota for the 2013 Upland Cotton Crop
WASHINGTON, Aug. 3, 2012 – The U.S. Department of Agriculture (USDA) announced on August 3 that no marketing quota will be in effect for the 2013 upland cotton crop.
The Food, Conservation, and Energy Act of 2008 authorizes a commodity program for only the 2008 through 2012 crops of upland cotton. Unless new farm legislation is enacted (or the current farm bill extended), any ac-tions taken pertaining to the 2013 upland cotton crop must be done in accordance with “permanent law” provisions of the Agricultural Adjustment Act of 1938, as amended (the 1938 Act), and the Agricultural Act of 1949, as amended, which are suspended through the 2012 crops. These permanent law provisions would authorize the im¬position of marketing quotas, acreage allotments and parity price support programs for upland cotton. Since the 2008 Farm Bill only covers through the 2012 crop, the Secretary is required by the 1938 Act to announce whether or not a marketing quota will be in effect for the 2013 upland cotton crop not later than Oct. 15, 2012.
The 1938 Act would require a marketing quota for the 2013 upland cotton crop if the Secretary were to deter¬mine for the preceding crop year that the total supply of cotton will exceed the normal supply of such crop. Nor-mal supply is defined as the sum of total domestic and export use plus carryout stocks equal to 30 percent of such use. Based on projected supply and demand, no quota is required.
Regional Price Information
Southeastern
A light volume of color 41, leaf 3 and 4, staple mostly 35 and 36, mike 43-52, strength 28-30, and uniformity 79-81 sold for around 69.50 cents per pound, FOB car/truck (Rule 5, compression charges paid).
A light volume of color 41 and 51, leaf 3-5, staple 34 and 35, mike 43-49, strength 27-29, and uniformity 79-81 sold for about 65.00 cents, same terms as above.
South Central
North Delta
A moderate mode of CCC loan equities traded for around five to thirteen cents per pound.
South Delta
A light volume of color 41 and better, leaf 6 and better, staple 35-37, mike 47-49, strength 28-31, and uniformity 80¬83 sold for around 70.00 cents per pound, FOB car/truck (Rule 5, compression charges paid).
East Texas
In Texas, even-running lots of 2012-crop cotton of color 21 and 31, leaf 2 and 3, staple 36, mike 45-47, strength 31-33, and uniformity 81-83 sold for around 76.00 cents per pound, FOB warehouse (compression charges not paid).
A light volume of color 21 and 31, leaf 2 and 3, staple 34 and 35, mike 43-49, strength 28-31, and uniformity 80-82 sold for 72.75 to 74.00 cents, same terms as above.
A light volume of color 31 and better, leaf 3 and better, staple 34, mike 43-49, strength 25-30, and uniformity 78-82 sold for 69.00 to 70.00 cents, same terms as above.
A moderate volume of color 31 and better, leaf 2 and better, staple 32 and 33, mike averaging 46.7, strength averaging 29.7, and uniformity averaging 80.3 sold for around 62.50 cents, same terms as above.
A light volume of CCC-loan equities traded for one to six cents.
West Texas
A moderate volume of mixed lots containing mostly color 31 and better, leaf 3 and better, staple 34 and longer, mike 43-50, strength 26-32, and uniformity 78-80 sold for around 69.25 cents per pound, FOB car/truck (compression charges not paid).
Even-running lots containing a moderate volume of color 31 and better, leaf 3 and better, staple 33 and longer, mike 35-49, strength 27-31, and uniformity 78-81 sold for 65.00 to 67.00 cents, same terms as above.
A light volume of mostly 41, leaf 5 and better, staple 34 and longer, mike 30-49, strength 26-28, and uniformity 78-80 sold for 60.00 to 62.25 cents, same terms as above.
A moderate volume of CCC-loan equities traded for one to fifteen cents.
Desert Southwest
No trading activity was reported.
San Joaquin Valley
A light volume of 2012-crop cotton of color 21, leaf 2, and staple 36 was contracted.
A moderate volume of roller-ginned Acala color 21, leaf 2, and staple 39 was contracted for 1500 points on ICE December futures.
American Pima
No trading activity was reported.
Source: USDA
