USDA-Weekly Cotton Market Review: August 3, 2017

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Average quotations were 150 points higher 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 35-36 and 43-49, strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets averaged 68.08 cents per pound for the week ending Thursday, August 3, 2017.

The weekly average was up from 66.58 last week, but down from 72.75 cents reported the corresponding period a year ago. Daily average quotations ranged from a low of 67.19 cents Friday, July 28 to a high of 68.86 cents Wednesday, August 2.

Spot transactions reported in the Daily Spot Cotton Quotations for the week ended August 3 totaled 2,088 bales. This compares to 1,271 bales reported last week and 2,321 spot transactions reported the corresponding week a year ago.

Total spot transactions for the 2016-2017 marketing year were 1,566,571 bales compared to 1,523,740 at the end of the 2015-2016 marketing year. The ICE October settlement prices ended the week at 71.55 cents, compared to 70.50 cents last week.

USDA-Weekly Cotton Market Review: August 3, 2017

Southeastern Markets Regional Summary

Spot cotton trading was slow. Supplies and producer offerings were light. Demand was moderate. Average local spot prices were higher. Trading of CCC-loan equities was inactive. Producers took advantage of higher ICE futures during the period to fix prices on a moderate volume of 2017-crop cotton.

Sunny to partly cloudy conditions prevailed over Alabama, Georgia, and the Florida panhandle during the period, with slightly cooler daytime high temperatures in the upper 80s to lower 90s. Scattered thundershowers brought around one-half of an inch of weekly accumulated moisture to most areas, with slightly heavier totals observed in some areas.

The crop progressed well under ideal weather and fields were blooming and boll-setting advanced. Fungicide treatments were underway in some fields in Alabama to treat pressure from plant disease. A variety of plant bugs have been observed in some of the earliest-planted fields where blooming was underway and sprays were applied. Whitefly and spider mite populations were building in Georgia, and some fields met threshold limits.

The crop progressed well in the Carolinas and Virginia as similar conditions prevailed during the week with daytime highs in the upper 80s to lower 90s. Localized shower activity brought around one-quarter to one inch of moisture to most areas early in the period.

However, continued dryness across much of central North Carolina led to the expansion of abnormally dry conditions according to the U.S. Drought Monitor. Producers scouted fields and applied treatments for Bt-resistant bollworms and stinkbugs.

In Virginia, corn earworm moth counts had begun to build in some areas and producers were scouting fields.

According to the National Agricultural Statistics Service’s Crop Progress report released July 31, boll-setting had reached 67 percent in North Carolina, 66 in Georgia and Virginia, 59 in South Carolina and 53 percent in Alabama.

Textile Mill

Domestic mill buyers inquired for a moderate volume of 2017-crop cotton, color 51 and better, leaf 5 and better, and staple 34 and longer for fourth quarter 2017 through second quarter 2018 delivery. No sales were reported. Additional demand was light; reports indicated most mills have covered their immediate to nearby raw cotton needs. Most mills operated five to seven days.

Demand through export channels was moderate. Demand was good throughout the Far East for discounted styles of cotton.

Trading

A light volume of color 31, leaf 3 and 4, staple mostly 32 and 33, mike 31-35, strength 25-28, and uniformity 79-81 sold for around 65.00 cents per pound, FOB car/truck, Georgia terms (Rule 5, compression charges paid, 30 days free storage).

Mixed lots containing color mostly 31 and 41, leaf 2-5, staple 34-37, mike 33-49, strength 27-29, and uniformity 79-81 sold for around 67.00 cents, FOB car/truck (Rule 5, compression charges paid).

A light volume mixed lots containing color mostly 52 and better, leaf 6 and better, staple 32 and longer, mike 43-49, strength 28-31, and uniformity 80-82 sold for around 63.00 cents, same terms as above.

South Central Markets Regional Summary

North Delta

Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported.

Mostly clear to partly cloudy and warm climatic conditions characterized the weather pattern. A series of thunderstorms early in the week brought both much needed cooler temperatures and some rainfall. Most areas reported less than an inch of moisture. Daytime temperatures were in the 80s and overnight lows were in the 60s to 70s.

Producers continued to run irrigation pumps in most cases to maintain adequate soil moisture levels for good boll formation. Plant growth regulators were in widespread application.

Local experts reported widely varying levels of bollworm pressure. At least two treatments have been in fields where control measures have been applied, and producers are concerned about overall costs should additional treatments be required before the end of the season. Plant bug populations remained low, but outbreaks of spider mites were reported in Missouri.

According to the National Agricultural Statistics Service’s (NASS) Crop Progress report released July 31, boll-setting reached 95 percent in Arkansas, 30 percent in Missouri, and 64 percent in Tennessee. NASS also reported that 51 percent of the crop was in good condition in Arkansas, compared with 53 percent in Missouri and 56 percent in Tennessee.

South Delta

Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported.

Mostly clear to partly cloudy and warm climatic conditions prevailed during the week. A line of thunderstorms early in the week brought cooler temperatures and some rainfall. Most areas reported less than an inch of moisture. Daytime temperatures were in the 80s and overnight lows were in the 60s to 70s. Producers were irrigating in most cases to meet the needs of the maturing crop.

Cotton extension specialists reported wide-ranging levels of bollworm pressure. In many cases, at least two treatments have been in fields where chemicals have been sprayed, and producers are concerned about cost of additional treatments, should they be required before the crop finishes. Spider mites were treated in a few fields.

According to the National Agricultural Statistics Service’s (NASS) Crop Progress report released July 31, boll-setting reached 88 percent in Louisiana and 71 percent in Mississippi. NASS also reported that 81 percent of the crop was in good condition in Louisiana, compared with 45 percent in Mississippi.

Trading

North Delta

No trading activity was reported.

South Delta

No trading activity was reported.

Southwestern Markets Regional Summary

East Texas

Spot cotton trading was moderate. Supplies and producer offerings were moderate. Demand was very good. Average local spot prices were higher. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were heavy. Interest was best from China, Indonesia, and Turkey.

In the Rio Grande Valley, dryland harvesting neared completion. Harvesting of irrigated fields had expanded to around 25 percent completed. Rainfall stalled harvesting activities for one day, but producers were able to return to the fields the next afternoon, according to local reports. Producers were encouraged with dryland yields at 2.5 to 3.5 bales per acre.

In central Texas, daytime temperatures were around 105 degrees in some areas, and the rainfall helped alleviate heat stress. The dryland crop had begun to open in the southern Blackland Praries, and final irrigation water was applied. Defoliants and pre-harvest aid chemicals were expected to be applied in two weeks. Insecticides were applied for stinkbugs and bollworm pressure was light.

In Kansas, timely rainfall helped the stands to advance and all had squared; some had begun to set bolls. Temperatures below 100 degrees helped with fruit retention. The local agricultural community has supported first time cotton producers through educational information and other sources to assist with a successful cropping season.

In Oklahoma, spotty rainfall helped the stands advance, but more rainfall would be welcomed. Plants presented an early-season heavy boll load. Insect pressure was light. Weed pressure was heavy.

West Texas

Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was very light. Average local spot prices were higher. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Interest was best from China, Indonesia, and Turkey.

Rainy conditions prevailed with reports of up to more than 5 inches of beneficial precipitation received early in the reporting period. Some fields in eastern New Mexico received more than 8 inches of rainfall. Intermittent rainfall continued throughout the reporting period. Soils were soggy and fieldwork was at a standstill. The rainfall was beneficial, and producers prepared for excessive growth by making plans to apply plant growth regulators as soon as the fields dried.

Plans were underway for controlling the new weeds that have already emerged. The timely rainfall helped dryland stands to retain fruit. Wells in irrigated fields were shut off and may not be used for the remainder of the season. Stand maturity varied from not blooming to full bloom and some have reached cut-out, according to local experts.

Trading

East Texas

In Texas, a light volume of new-crop color 21 and 31, leaf 2 and 3, mostly staple 37, mike 41-45, strength 28-32, and uniformity 80-83 sold for around 71.50 cents per pound, FOB warehouse (compression charges not paid).

A light volume of color mostly 41, leaf 2 and 3, staple 35 and 36, mike averaging 41.4, strength 27-31, and uniformity 79-82 sold for around 70.00 cents, same terms as above.

Mixed lots containing a light volume of mostly color mostly 42 and better, leaf 2 and 3, staple 33 and 34, mike 39-53, strength 25-31, and uniformity 77-82 sold for around 67.50 cents, same terms as above.

West Texas

A mixed lot of 2016-crop cotton containing mostly color 43 and better, leaf 5 and better, staple 36 and longer, mike averaging 27-54, strength 26-32, and uniformity 78-82 sold for around 61.50 cents per pound, FOB car/truck (compression charges not paid).

Western Markets Regional Summary

Desert Southwest (DSW)

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

Around one-half of an inch of rainfall was received in Yuma, Arizona and damage was assessed since bolls had begun to open. Early reports indicated that damage was minimal. Pre-harvest aids and defoliants were applied. Harvesting had begun on a few fields. In central Arizona, fields had dried from recent rainfall. According to local reports, the crop was either late or early and showed variances in maturity levels.

Defoliation and pre-harvest aids were applied to fields around Coolidge, AZ and in the Mojave Valley. Final irrigation water was applied to some stands. The humidity caused by monsoonal pressure coupled with hot temperatures in the 100s has caused heat stress, which is normal during this time of the year.

Stands advanced with daytime temperatures in the mid-to-high 90s in New Mexico and El Paso, Texas. The crop was in full bloom and had begun to set bolls. Irrigation was applied. Insect and weed pressure was light.

San Joaquin Valley (SJV)

Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local spot prices were higher. Producer interest in forward contracting was light. No domestic mill activity was reported. Foreign mill inquiries were moderate.

The crop made good progress with daytime temperatures consistently above 100 degrees. A heavy lygus infestation threatened fruit retention and permission was granted to apply different chemistries to help control populations. Irrigation was underway. Plant growth regulators were applied where needed.

American Pima (AP)

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

In California, stands progressed under hot, dry conditions. Fields in the San Joaquin Valley experienced high populations of lygus and an emergency section 18 crisis exemption was granted for producers to use certain products to control infestations. The exemption is through August 4, but hopes are to have that extended.

In Arizona, about one-half of an inch of rainfall was received. High temperatures and high humidity continued to stress plants. Some fields approached the final irrigation. Portions of southern New Mexico and El Paso, Texas received beneficial moisture. The crop progressed and boll setting increased.

Trading

Desert Southwest

No trading activity was reported.

San Joaquin Valley

No trading activity was reported.

American Pima

No trading activity was reported.

Full report:

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