While trade shorts have no other choice but to buy back their contacts between now and June, spec longs have the option to roll their longs into new crop and pick up huge roll gains in the process. In other words, the shorts have to get out, while the longs don’t, and that in a nutshell is the story that drives current crop prices higher.

New crop is still an entirely different story, as plenty of growers are waiting for an opportunity to put on some hedges against next season’s crop. December ran into heavy resistance at the psychologically important 80 cents level last week and has since dropped back below 77 cents, but we would not sell it here and instead wait for another opportunity.

Plexus Cotton Limited