A late bout of suspected short-covering amid a new round of widespread thunderstorms on the Texas High Plains and more planting delays in the area’s short growing season have helped to lift cotton futures.
Spot July gained 60 points to close at 64.33 cents for the week ended Thursday, a six-session high finish, while December edged up 36 points to settle at 65.09 cents, its highest settlement since May 18.
July posted back-to-back lows at 63.03 cents, unable to make further downside progress after falling to its lowest intraday prints since April 23, and bounced back above technical support (63.50) at a 50 percent retracement of the 926-point rally from the Jan. 23 low to the May 1 high.
It still was on track to finish with a loss for the month, settling 355 points, or 5.2 percent, below its April 30 close.
Producers faced critical cropping decisions on the High Plains, the nation’s largest cotton patch, where the crop insurance cotton planting deadline in the more heavily irrigated areas north of Lubbock is at hand.
With more rain in prospect, May already ranked as the second wettest on records back to 1911 at Lubbock, eclipsed only by 12.69 inches in May 1941 when the annual rainfall totaled an all-time high of 40.55 inches.
Rain chances were expected to diminish after Saturday, boosting planting prospects, but concerns mounted that many growers appeared unlikely to complete cotton planting by the insurance deadlines of May 31 in the north and June 5 in central counties.
The deadline is June 10 in the southern High Plains, which also has mostly sandier soils, and June 20 in some Rolling Plains counties.
Shawn Wade, director of policy analysis and research for the Lubbock-based Plains Cotton Growers, Inc., said in a PCG report that producers have multiple ways under federal crop insurance provisions to deal with wet weather issues.
They can plant cotton beyond the deadlines and have their insurance coverage reduced 1 percent per day during a seven-day late period, he explained. Timely and late-planted acreage guarantees then would be combined to determine the overall coverage.
Prevented-planting options also are available. These rules and procedures are complex and include a number of possible outcomes depending upon decisions made by the producer, Wade said.
Growers in Texas as of May 24 had planted only 29 percent of their cotton acres, 18 percentage points behind last year and 21 points behind the five-year average. Producers in Texas have been expected to plant 5.7 million acres of cotton, 60 percent of the U.S. cotton area.
A big area on the High Plains, especially dryland fields in the southern district, still has strong potential for high yields and lower acreage abandonment because of the virtually full soil moisture profile.
Weed control problems the last few seasons have resulted in producers on the Plains getting more aggressive in the use of pre-planting herbicides in their primary row crop, cotton.
This has posed a dilemma with the long wet period delaying most cotton plantings, said Blayne Reed of Plainview, integrated pest management agent for Hale, Swisher and Floyd counties north of Lubbock.
Reed summarized discussions with Jordon Bell and Wayne Keeling, extension agronomists in the northern and southern districts on the High Plains, respectively, regarding what can be done in fields that were treated aggressively with pre-planting residual cotton herbicides.
Keeling said sorghum and even an earlier maturing-type corn don’t necessarily have to be ruled out on Treflan-treated (yellow) ground. Because this herbicide is bound tightly in the soil, producers can plant below the chemical, he explained.
The depth, he said, depends upon how deep the herbicide was incorporated. Planted below the herbicide, the cotyledon can grow through the chemical. But if planted above the herbicide, roots will grow into it and result in quick damage.
The damage can be detected four to five days after planting as long as soil temperatures are ideal to promote germination, he said. Recent rains won’t wash away the herbicide and alleviate the problem, he added.
It’s best to plant with soil temperatures at 65 degrees for 10 days to ensure vigorous early growth, the agronomist said. Planting in cool soil temperatures can result in stressed plants more susceptible to herbicide damage and such other problems as disease and pest issues.
Meanwhile, trend-following funds reduced their net longs by 5,641 lots to 35,641 in U.S. cotton futures-options combined during the week ended May 19, according to government traders-commitments data.
Index funds raised their net longs by 1,936 lots to 65,445, while traders with non-reportable positions reduced theirs by 1,137 lots to 5,429.