International Cotton Market Update

14-Dec-2024 08:23 AM

International Cotton Market Update
ICE Cotton Futures
ICE cotton futures declined by 71 to 86 points during Friday's session.
The March contract closed the week with a net loss of 84 points.
External Markets:
The US dollar index showed a slight rise.
Crude oil prices increased by $1.07 per barrel.
Commitment of Traders (COT) Data
Speculators added 5,840 contracts to their net short positions as of December 12.
The total net short position climbed to 22,223 contracts, signaling a bearish speculative sentiment.
Export Sales
Total Cotton Shipments:
Reached 2.293 million running bales (RB), marking a 12% decrease compared to last year.
Represents 22% of USDA’s export estimate, trailing the average pace of 25%.
Total Commitments (Shipped + Unshipped):
Stand at 7.012 million RB, down 12% year-over-year.
This reflects 66% of the USDA projection, lagging behind the 73% average pace.
Additional Data
The Seam Sales: On December 12, 5,661 bales were sold online at an average price of 64.99 cents/lb.
ICE Cotton Stocks: Remained steady at 20,113 bales.
Cotlook A Index: Increased by 65 points, closing at 80.25 cents/lb on December 12.
USDA Adjusted World Price (AWP): Dropped by 152 points to 56.22 cents/lb on Thursday.
Market Impact
Speculative Trends:
The addition to net short positions underscores a negative sentiment among speculators, likely contributing to downward pressure on prices.
Export Performance:
Sluggish shipping and commitments, both trailing historical averages, create headwinds for market recovery.
Price Trends:
The AWP cut and low average selling prices highlight bearish market conditions.
Summary:
The cotton market faces downward pressure from declining exports and rising speculative short positions. However, external factors, such as the increase in crude oil prices, may offset some bearish momentum. The market remains fragile, with future trends dependent on export improvements and speculative positioning.