Home / Knowledge / News / Textiles / NY cotton futures drop
NY cotton futures drop
Nov '11
Plexus Cotton Limited reports that NY futures ended the week mixed, as December managed to close unchanged at 99.50 cents, while March dropped 240 points to close at 96.48 cents.

For most of the week the market tried to work its way higher in the wake of continued strong buying by the Chinese Reserve and expectations of another strong export sales report. Even though the export numbers didn't disappoint, the session turned into a typical "buy the rumor - sell the fact" affair, with the two front months closing limit down. Most of the blame for today's dismal performance goes to speculators, who once again shied away from commodities due to all the negativity emanating from the European debt crisis.

US export sales of Upland and Pima cotton amounted to 646'800 running bales net, of which China took 630'200 running bales net. In addition to that there were 528'000 bales sold to China under 'optional origin'. Total sales for the season now amount to 9.5 million statistical bales and there are another 1.3 million statistical bales in the 'optional' category. Shipments continue to lag behind though, with only 1.5 million bales exported at this point, which means that the backlog of outstanding commitments has now grown to around 8.0 million bales.

The global cotton situation reminds us of a game of 'musical chairs', with China operating the "on/off" switch. According to the latest USDA figures, the rest of the world (excluding the US) will produce a record crop of 107.6 million bales this season, surpassing the previous mark set in 2006/07 by no less than 7.0 million bales. However, mill demand in the rest of the world is expected to remain stagnant at 110.5 million bales, due to slow economic growth and man-made fiber substitution. As a result the seasonal production gap is expected to drop to just 2.8 million bales, which compares to much larger deficits of 13.3 million bales last season and 26.1 million bales two years ago.

Considering that the rest of the world is nearly self-sufficient, the US has done extremely well by filling its order books to the tune of 9.5 million bales, thanks to the fierce pace of sales earlier in the year, when mills were still fearful that the world would run out of cotton. As a result the US has entered this marketing year with a record 7.5 million bales in carry-in sales. But while the US has made great strides on the export front, its competitors around the globe, such as India, Central Asia, Brazil, Australia and the various African origins, may be left scrambling for a chair to sit on.

This situation is likely to lead to fierce competition among non-US growths, as they try to capture their fair share of this anemic market. Fortunately China has been acting as a stabilizing force by aggressively procuring some of the excess supply, both in the domestic and international markets, otherwise prices would already have come under a lot more pressure. The Chinese Reserve has so far lifted 2.7 million statistical bales in the Chinese market and probably a similar amount overseas. However, the market realizes that this Reserve buying doesn't represent real consumption and that it is the only game in town, which is not very comforting.

Must ReadView All

Textiles | On 20th Feb 2017

UK textile & apparel exports up 7.05% in 2016: UKFT

The exports of apparel and textiles from the UK have increased by...

Textiles | On 20th Feb 2017

Himatsingka Seide incorporates subsidiary in Europe

Himatsingka Seide Ltd, one of the largest producers of home textiles...

Textiles | On 20th Feb 2017

Sri Lanka's textile exports rise 2.3% in Jan-Oct '16

Exports of textiles and garments from Sri Lanka increased by 2.3 per...

Interviews View All

Rajiv Sirohi

‘Portugal is taking away a major share of the mill made sector.’

Studio Priyanka Rajiv

‘To reinvent the age-old tradition of embroidery to suit demographics and...

Siddharth Biyani
Mangalam Industries Pvt Ltd

‘The manufacturing sector is improving day-by-day, becoming better in...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Pranav Mishra

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer Prathyusha Garimella is known for blending...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

February 2017

February 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Subscribe today and get the latest News update in your mail box.
Advanced Search