Interviews
China cotton to be higher than expected
26 May '07
3 min read
Export shipments of upland were a marketing year high of 361,500 RB. Shipments of Pima added another 34,000 RB, taking total weekly shipments to 395,500 RB. Yet, even with a total of 361,500 RB shipped, weekly shipments fell well below (15,000-20,000 bales) the level required to meet the USDA export estimate of 13.25 million bales.
Countries such as Turkey, Mexico, Indonesia, Taiwan, Thailand and South Korea will remain consistent buyers. Thus, the market waits on that "big" Chinese purchase-the one that most likely will not occur.
Domestic consumption took another hit during April as U.S. textile mills used cotton at an annualized rate of 4.86 million bales, slightly below the current USDA forecast for the season of 4.9 million bales. Domestic usage for March was revised lower to 4.76 million. Thus, the past three months data suggests that U.S. consumption will fall to 4.8 million for the 2006-07 season.
Last week's low prices, coupled with price slides below 50 cents this week found willing buyers. Thus, exports should remain strong. The key will be whether shipments can climb to near 425,000 bales each week.
December above 56 cents is a bit high for now. However, that level will be breached as we move through the summer. The low price cure for low prices is having some effect.
Countries such as Turkey, Mexico, Indonesia, Taiwan, Thailand and South Korea will remain consistent buyers. Thus, the market waits on that "big" Chinese purchase-the one that most likely will not occur.
Domestic consumption took another hit during April as U.S. textile mills used cotton at an annualized rate of 4.86 million bales, slightly below the current USDA forecast for the season of 4.9 million bales. Domestic usage for March was revised lower to 4.76 million. Thus, the past three months data suggests that U.S. consumption will fall to 4.8 million for the 2006-07 season.
Last week's low prices, coupled with price slides below 50 cents this week found willing buyers. Thus, exports should remain strong. The key will be whether shipments can climb to near 425,000 bales each week.
December above 56 cents is a bit high for now. However, that level will be breached as we move through the summer. The low price cure for low prices is having some effect.
O.A. Cleveland
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