NY cotton futures gains momentum this week

Once again there were 18 markets participating, which shows that there is still broad based demand for US cotton. Total commitments for the current marketing year are now at 9.6 million statistical bales, of which 5.9 million bales have so far been exported.

 

NY futures resumed their uptrend this week, as May rallied 380 points to close at 91.61 cents, while December gained 171 points to close at #

Talk about additional Chinese imports quotas provided additional fuel for the bulls this week. In addition to the annual Tariff-Rate-Quota (TRQ) of 894’000 tons, there are strong rumors that a 4-by-1 sliding scale quota (four bales of Reserve cotton entitle to one bale of imported cotton) as well as a 500’000 tons processing quota would be released over the next few weeks. If these quotas became reality, it would probably boost Chinese imports beyond the 11.0 million bales estimate of the USDA and render a tight ROW situation even tighter. 

 

NY futures resumed their uptrend this week, as May rallied 380 points to close at 91.61 cents, while December gained 171 points to close at #

So where do we go from here? The fact that hedge funds are taking a liking to the commodity complex in general and to the cotton market in particular is not boding well for trade shorts. This breakout to new highs looks impressive on the chart and will probably attract additional fund buying. 

 

NY futures resumed their uptrend this week, as May rallied 380 points to close at 91.61 cents, while December gained 171 points to close at #

As we have stated repeatedly, we see no easy way out for the many trade shorts that have been fighting this trend for the last 17 cents. On-call sales showed hardly any improvement last week, as there were still 4.67 million bales unfixed on May and July.

 

NY futures resumed their uptrend this week, as May rallied 380 points to close at 91.61 cents, while December gained 171 points to close at #

Unless speculators somehow get spooked into abandoning their net long or the trade finds a large block of tenderable cotton to put on the board, this story will end as it usually does, with a ferocious short squeeze that inflicts a lot of financial pain to those who don’t get out of harms way in time!

 

NY futures resumed their uptrend this week, as May rallied 380 points to close at 91.61 cents, while December gained 171 points to close at #