Domestic Crop Concern Lifts Cotton Futures

Cotton futures spiked to their highest price this month on the outlook severe weather in certain parts of the country will interfere with the cotton harvest.  The US is the world’s biggest exporter of cotton with several varieties grown around the nation.

The USDA stated yesterday cotton farmers have already harvested 78% of this year’s crop – 10% less than last year at this time, and 5% less than the five-year average.  The “above-normal” rains predicted this week across the Southeast are expected to delay fieldwork & harvesting in that region with the wet conditions possibly degrading the quality of the fiber in the process.

Mason Ching, Automated Trading Manager at Global Futures Exchange & Trading Company in Encino, CA, had this to say about the current cotton futures situation,There are also questions about demand in China as the government there is expected to offer its supplies into the domestic market.”

The trend for cotton futures remains down, and I view this current pull-back higher in cotton prices as an opportunity to once again “go short.”  I will be looking at cotton futures again after the market closes.

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