It looks more likely that shipments of this crop will take place after July 31, 2007.
INTERNATIONAL: Australia - For farmers who have irrigation water, planting is well under way; for those who do not, rainfall received recently over much of the cotton belt may help.
The combination of a shift to alternative summer crops such as sorghum and corn by “die hard” cotton producers and the effects of the drought will undoubtedly contribute to what could be the smallest crop in over 10 years.
Current estimates range from 1.2 to 1.7 million bales; our estimate is on the lower end.
China - There has been some inference that the import quota policy covering the sliding-scale duty (5 to 40 percent) might be under review by the government and adjusted to reduce the rate on lower grades.
Mill inquiries on the international consignment stocks are increasing as mills seek to take advantage of the current low import prices and to lock in quality to use against their 1 percent quota, which should be released around January 1.
This brings the growth for the first ten months of this year to 24.1 percent versus the same period last year.
OUTLOOK: We really do not foresee any fireworks during the upcoming Dec06 delivery period. Focus will now be on Mar07, which has also not shown any signs of strength. With the vast majority of the U.S. crop yet to be sold/hedged, any rally in NYK should be met by aggressive hedge pressure.
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-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
