Bumper Crop in India Sets Back Cotton Futures

Cotton futures have tanked since the news reported India’s biggest cotton trader stated his nation’s cotton production is set to reach an all-time high. India’s farmers evidentially are switching from soybeans & peanuts to cotton with the delays in monsoon rains.

According to the Chairman of Cotton Corporation of India, that nation’s cotton harvest is expected to expand little more than 2.5% to 40M bales in the fiscal year starting October 1st. This expected bumper crop in India may curb any significant rally in cotton prices that have already fallen 20% this year.

With the time window for sowing soybeans and peanuts behind the Indian farmers, cotton seems to be the last resort, and will add to already committed acreage,” stated Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, sharing his insight regarding the current cotton futures situation.

Cotton futures trend is down despite the lengthy sideways action we endured these past two weeks. We are short cotton futures since early this morning and this market continues to make new lows.

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