NY futures bounces back & forth in 205 point range
11 Aug '06
3 min read
The latest spec/hedge report confirmed that last week's activity was still confined to spec and trade shorts exchanging positions, while potential new buyers remained on the sidelines.
During the course of last week, spec shorts reduced their exposure by another 0.8 mio bales to 6.4 mio bales, while trade shorts increased their position by 0.9 to 9.9 mio bales.
On the long side, specs still held 8.7 mio bales and the trade owned 7.7 mio bales. Open interest increased by a modest 1'000 contracts last week and amounted to 163'290 contracts as of last Friday.
Today's US export sales report clearly illustrates how lackluster business has been recently.
For the week ending August 3, US upland sales amounted to just 95'100 running bales, of which 58'000 were for the 2007/08 marketing year. Pima sales amounted to 15'700 running bales last week.
Shipments were again very robust at 536'800 running bales, as merchants were taking advantage of the expiring Step 2 payment.
Total US exports in the 2005/06 season amounted to a record 17.04 mio running bales, which corresponds to around 17.7 mio statistical bales.
That is no less than 0.7 mio bales more than the latest USDA estimate and we should therefore see US ending stocks drop to 5.8 mio bales, not counting an estimated 1.5 mio bales that have been consigned overseas.
For the 2006/07 season, total commitments amount to just 1.8 mio running bales so far, including the 927,700 running bales that were carried over from last season. This is substantially less than a year ago, when commitments amounted to 4.1 mio bales at this point.
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