Interviews
Total cotton plantations likely to lower 28%, USDA
02 Jul '07
5 min read
However that is only about a weeks worth of cotton and didn't impress anyone. Additionally, their banks began pressuring merchants to move inventory. This too had very little effect Domestic mill consumption last month was on target to meet USDA's modest 4.9 million bale target; less than half of what was consumed at US spinning mills a decade ago.
USDA estimates that no more than 4.4 million bales will be opened at US domestic mills during the 2008 crop year; the least spun domestically in over 100 years. Export sales this past week were possibly inflated by consignment sales to China in an effort to continue to satisfy their hand-to-mouth buying practices. Mills without coverage have tried desperately to resist the meteoric rise in prices.
However, at least for now, it looks like those without coverage or protective long hedges in futures or options have a long hot summer ahead of them. The gates are open and the bull are running full steam Welcome rains from Arkansas to the Carolinas this weekend.
Sunday afternoon there were still beneficial showers around in northern Louisiana, southern Arkansas, along either side of the Mississippi River in both Arkansas and Mississippi as well as southwest Georgia. Technically, cotton continues to be a giant. As a "late bloomer" in the index funds portfolio, it is certainly catching up and attracting attention. A position of 30 percent net long for the spec community would surprise no one.
This is the second consecutive week that even the most astute commercial analyst and observers have been surprised by the markets refusal allow even a modest correction. Merchants carry a record short hedge position and for the most part from a much lower level. Mills continue to need to buy cotton to keep their doors open.
The major Memphis merchants did seem to be big sellers above 6400 in both futures and options Friday and may very well be there again today. However, sellers at lower levels have been scarce and probably will continue to be so until smaller, vulnerable specs get too long at too high a level.
On the other hand, Fridays volatility should be short lived which should allow for consolidation and development of an identifiable trading range prior to the July WASDE and supply/demand report Swiss Financial Services Mandeville, Louisiana.
USDA estimates that no more than 4.4 million bales will be opened at US domestic mills during the 2008 crop year; the least spun domestically in over 100 years. Export sales this past week were possibly inflated by consignment sales to China in an effort to continue to satisfy their hand-to-mouth buying practices. Mills without coverage have tried desperately to resist the meteoric rise in prices.
However, at least for now, it looks like those without coverage or protective long hedges in futures or options have a long hot summer ahead of them. The gates are open and the bull are running full steam Welcome rains from Arkansas to the Carolinas this weekend.
Sunday afternoon there were still beneficial showers around in northern Louisiana, southern Arkansas, along either side of the Mississippi River in both Arkansas and Mississippi as well as southwest Georgia. Technically, cotton continues to be a giant. As a "late bloomer" in the index funds portfolio, it is certainly catching up and attracting attention. A position of 30 percent net long for the spec community would surprise no one.
This is the second consecutive week that even the most astute commercial analyst and observers have been surprised by the markets refusal allow even a modest correction. Merchants carry a record short hedge position and for the most part from a much lower level. Mills continue to need to buy cotton to keep their doors open.
The major Memphis merchants did seem to be big sellers above 6400 in both futures and options Friday and may very well be there again today. However, sellers at lower levels have been scarce and probably will continue to be so until smaller, vulnerable specs get too long at too high a level.
On the other hand, Fridays volatility should be short lived which should allow for consolidation and development of an identifiable trading range prior to the July WASDE and supply/demand report Swiss Financial Services Mandeville, Louisiana.
Swiss Financial Services
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