USDA – Weekly Cotton Market Review: January 18, 2012

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Weekly Cotton Market Review  January 18, 2013 Spot cotton quotations averaged 104 points higher 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 43-49,  strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets averaged  71.91 cents per pound for the week ended Thursday, January 17, 2013. The  weekly average was up from 70.87 cents last week, but down from 90.39 cents  reported the corresponding period a year ago. Daily average quotations ranged  from a low of 70.94 cents on Monday, January 14 to a high of 73.13 cents on  Thursday, January 17. Spot transactions reported in the Daily Spot Cotton Quotations  for the week ended January 17 totaled 119,712 bales. This compares to  50,343 bales last week and 35,467 bales reported a year ago. Total spot transactions  for the season were 1,193,822 bales, compared to 516,262 bales the corresponding  week a year ago. The ICE March settlement prices ended the week at  77.78 cents, compared to 75.20 cents last week.

Prices are in effect from January 18-24, 2013 
Adjustment World Price (AWP) 63.39 ELS Competitiveness Payment 0.00 
Loan Deficiency Payment (LDP) 0.00 Fine Count Adjustment 2011 Crop 0.76 
Coarse Count Adjustment (CCA) 0.00 Fine Count Adjustment 2012 Crop 0.96 
Source: Farm Service Agency, FSA, USDA

USDA ANNOUNCES SPECIAL IMPORT QUOTA #23  FOR UPLAND COTTON  January 17, 2013

The Department of Agriculture’s Commodity Credit Corporation announced a spe- cial import quota for upland cotton that permits importation of a quantity of up- land cotton equal to one week’s domestic mill use. The quota will be established  on January 24, 2013 allowing importation of 14,776,787 kilograms (67,869 bales)  of upland cotton.

Quota number 23 will be established as of January 24, 2013, and will apply to  upland cotton purchased not later than April 23, 2013, and entered into the U.S.

not later than July 22, 2013. The quota is equivalent to one week’s consumption  of cotton by domestic mills at the seasonally-adjusted average rate for the period  August 2012 through October 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 active. Supplies were heavy.

Demand was good. Producer offerings were heavy.

Average local spot prices were higher. Trading of  CCC-loan equities was inactive.

Cloudy, overcast conditions persisted during the  period with daytime highs in the mid-50s to low 60s.

Localized areas received light, scattered precipitation  throughout the week. Winter storm Iago tracked  across north Alabama and north Georgia late in the  week and brought light, intermittent rain and snow  showers. Heavier snowfall accumulations of three to  six inches were recorded in northern North Carolina  and Virginia. A period of dry, sunny weather is needed  to help soft soils to firm. In some areas, modules  remained in fields that were too soggy to support  equipment. Ginning was winding down as several  additional gins had reduced operating schedules or  completed pressing operations for the season in south  Alabama, Florida, and Georgia. Ginning continued in  South Carolina.

 Record high cotton yields were recorded in most  Southeastern states for the 2012-crop year, according  to the National Agricultural Statistics Service. Record  yields of 1,129 pounds per acre in Virginia, 1,027 in  Georgia, 993 in North Carolina, 952 in Alabama, and  918 pounds in South Carolina. Producers considered  planting options for the 2013-crop year and planned to  attend upcoming regional meetings.

South Central Markets  

North Delta  

Spot cotton trading was inactive. Producer offerings  were light. Demand was light. Average local spot  prices were higher. Trading of CCC-loan equities was  slow.

Heavy rainfall early in the week dominated the  weather pattern. Up to five and one-half inches of  much needed precipitation was reported. The heavy  rainfall caused flooding in low-lying areas and damaged  several roadways in western Tennessee. A cold  front late in the week dropped daytime temperatures  into the low 30s. Overnight lows were in the upper  20s. Sleet and freezing rain resulted in icy road conditions  that caused schools and many businesses to  close. The precipitation continued to recharge the soil  moisture profile, but more rain is needed to reach ade-  quate soil moisture levels to support spring planting.

No outside activities were reported.

South Delta  

Spot cotton trading was slow. Producer offerings  were light. Demand was light. Average local spot  prices were higher. Trading of CCC-loan equities was  inactive.

 Wet conditions during most of the week dominated  the weather pattern. Rainfall totals of up to three  inches were reported. A cold front late in the week  dropped daytime temperatures in the upper 30s and  brought freezing rain and icy road conditions. Overnight  lows were in the low 30s. According to the U.S.

Drought monitor, adequate soil moisture was restored  throughout Louisiana and Mississippi. No outside activities  were reported. Producers continued monitoring  commodity prices and considered crop rotation  alternatives.

Southwestern Markets

 East Texas-Oklahoma

 Spot cotton trading was moderate. Supplies were  moderate. Demand was moderate. Average local spot  prices were firm. Producer offerings were light. No  forward contracting was reported. Trading of CCC- loan equities was inactive. Foreign mill inquiries  were light. Interest was best from China, Taiwan, and  Turkey.

 In Texas, most areas received winter precipitation,  but more is needed to lessen droughty conditions.

More moisture is needed to advance the wheat crop  and prepare soils for cotton planting. Planting preparations  were underway as producers lightly chiseled  fields following recent wet weather. In Kansas and  Oklahoma, the remaining modules were moved to the  gin yards. The gins continuing pressing operations  were expected to finish around mid-March.

West Texas  

Spot cotton trading was active. Supplies were moderate.

Demand was heavy. Average local spot prices  were firm. Producer offerings were light. No forward  contracting was reported. Trading of CCC-loan equities  was moderate. Foreign mill inquiries were moderate.

Interest was best from China, Taiwan, and Turkey.

Some areas received a light dusting of snow, which dampened fields and encouraged producers to return to  fieldwork. Recent wet weather provided an opportunity for light tillage of the fields to help prevent the topsoil  from blowing. One location that received one and one-half inches of rainfall motivated producers to rededicate  their planting strategies to cotton. Texas A&M Agrilife extension agents released trial results on a variety of subjects  including southern root-knot nematodes and seed variety performance.

Western Markets  

Desert Southwest (DSW)  

Spot cotton trading was inactive. Producer offerings were moderate. Supplies and demand were moderate. Average  local spot prices were higher. Foreign mill inquiries were light as futures prices trended higher.

 Freezing temperatures dominated the region for most of the period. Nighttime temperatures were in the low  30s in Arizona and in the mid-teens to mid-twenties for New Mexico. Ginning continued in Arizona and New  Mexico. Rain and snow is needed in New Mexico and El Paso, Texas areas to replenish sub-soil moisture. Lack  of water will impact planting intentions for the area.

San Joaquin Valley (SJV)  

Spot cotton trading was inactive. Supplies and demand were moderate. Average local spot prices were higher.

Foreign mill inquiries were light as futures prices trended higher. Some producers with unfixed contracts continue to look for an additional two to three cent increase in the ICE futures price in order to net 90 cents on their remaining bales under contract.No forward contracting or domestic mill activity was reported.

Much of California was in a deep freeze. Low temperatures in the SJV were at or just below freezing. Ginning  continued uninterrupted. Saw-ginning was virtually completed and three roller-gins continued to submit  samples for grading. Sources indicated that this was one of the largest crops on record at 1,651 pounds of lint as  reported by the National Agricultural Statistics Service.

American Pima (AP)  

Spot cotton trading was inactive. Supplies and demand were moderate. Average local prices were steady. No  forward contracting or domestic mill activity was reported. Foreign mill inquiries were light.

 The National Agricultural Statistics Service, Crop Production Summary report showed an increase of 105,000  bales in California AP production from December to January. The yield amount was raised by 225 pounds to 1,575 pounds per acre.  Overall, US production was raised 102,900 bales. The increase in production was attributed to unusually high  yields of 3.5 to 4.2 bales per acre in California. Ginning continued in the San Joaquin Valley.

Textile Mill Report

 Domestic mill buyers inquired for a moderate volume of color 41, leaf 4, and staple 34 and longer for nearby delivery.

Mill buyers also inquired for a moderate volume of color 51 and better, leaf 5 and better, and staple 32  and longer for first and second quarter delivery. Demand remained good for any discounted or low-grade qualities  of cotton. Demand for finished products was steady. Demand for ring-spun and open-end yarn was moderate.

Inquiries through export channels were good. Taiwanese mill buyers inquired for a moderate volume of  USDA Green Card Class, color 31, leaf 3, and staple 36 for nearby shipment. Turkish mill buyers inquired for a  moderate volume of USDA Green Card Class, color 41, leaf 4, and staple 34 for nearby shipment.

Regional Price Information

Southeastern Markets

Even-running lots containing color 21 and 31, leaf 2 and 3, staple 36 and 37, mike 43-49, strength 28  -30, and uniformity 80-82 sold for 175 to 200 points on ICE March futures, FOB car/truck (Rule 5,  compression charges paid).

Mixed lots containing color mostly 31, leaf mostly 2 and 3, staple 34 and longer, mike 37-49,  strength 27-29, and uniformity 80-83 sold for 25 to 50 points on ICE March futures, same terms as  above.

A moderate volume of color 41, leaf 4, staple 34 and longer, mike 37-49, strength 26-29, and uniformity  80-82 sold for around 275 points off ICE March futures, same terms as above.

A heavy volume of color 41 and 51, leaf 3-5, staple 35-38, mike 35-49, strength 29-32, and uniformity  80-83 sold for around 375 points off ICE March futures, same terms as above.

Mixed lots containing color mostly 31 and 41, leaf 3-6, staple 34 and longer, mike 37-49, strength 27  -30, and uniformity 80-82 sold for around 375 points off ICE March futures, FOB car/truck, Georgia  terms (Rule 5, compression charges paid, 30 days free storage).

A moderate volume of color 41, leaf 3-6, staple 34 and longer, mike 43-49, strength 29-31, uniformity  80-83, and containing approximately 55 percent bark sold for around 500 points off ICE March  futures, same terms as above.

South Central Markets  

North Delta  

A moderate volume of CCC-loan equities traded for around 15.75 cents per pound.

South Delta  

A moderate volume of color 31 and better, leaf 4 and better, staple 35 and longer, mike 43-49,  strength 26-32, and uniformity 80-83 sold for around 74.00 cents per pound, FOB car/truck, (Rule 5,  compression charges paid).

Southwestern Markets

 East Texas

 In Oklahoma, a light volume of color 21, leaf 1, staple 36 and longer, mike 35-37, strength 28-29,  and uniformity 79-80 sold for around 75.00 cents per pound, FOB car/truck (compression charges not  paid).

A light volume of color 21, leaf 3, staple 35 and longer, mike 46-50, strength 30-32, and uniformity  79-81 sold for around 70.00 cents, same terms as above.

A light volume of color mostly color 22, leaf 2, staple 35, mike 33-35, strength 30-31, and uniformity  averaging 79.5 sold for around 65.50 cents, same terms as above.

Mixed lots containing color mostly 32 and 42, leaf 6 and better, staple 32 and longer, mike 38-45,  strength 26-29, and uniformity 76-80 sold for around 64.00 cents, same terms as above.

West Texas  

A heavy volume of color mostly 21 and better, leaf 2 and better, staple 36 and longer, mike 35-49,  strength 27-32, and uniformity 78-81 sold for around 74.00 cents per pound, FOB car/truck  (compression charges not paid).

A heavy volume of color 21 and better, leaf 3 and better, staple 36 and longer, mike 34-52, strength  30-32, and uniformity 77-80 sold for around 72.25 cents, same terms as above.

A moderate volume of color 21, leaf 4 and better, staple 37 and longer, mike 30-52, strength 25-30,  and uniformity 78-81 sold for around 64.75 cents, same terms as above.

A moderate volume of color 21 and better, leaf 4 and better, staple 36 and longer, mike 37-47,  strength 24-32, uniformity averaging 79.0, and 50 percent bark sold for around 61.00 cents, same  terms as above.

A heavy volume of CCC-loan equities traded for five to fifteen cents.

Western Markets  

Desert Southwest  

No trading activity was reported.

San Joaquin Valley  

Some producers wanted to fix prices for around 90 cents per pound.

American Pima  

No trading activity was reported.

 Source: USDA

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