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Cotton Dips to Multi Week Low on Improved US Crop

Summary:
A stronger dollar and the arrival of needed rains in Texas have prompted traders to liquidate their cotton positions, sending the fiber to multi week lows. The most active December Cotton #2 contract on the ICE declined by 0.71 cents (1.07%) to settle at 65.58 cents per pound on Wednesday, touching a low of 65.41 cents during the session. The March 2017 contact declined 0.66 cents (0.99%) to settle at 66.01 cents per pound. From the middle of July through early August, cotton for December delivery soared, touching a high of 77.98 cents per pound on August 05. Though supply concerns have eased in the US, The Wall Street Journal reports that India, the world’s largest cotton producer, has signed agreements which will bring their total cotton imports for the year to around 2 million bales due to a challenging planting season. The USDA’s weekly crop progress report released on Monday after the market closed showed that 48% of US crops were in either good or excellent condition, a slight improvement from the 47% figure reported the previous week. Weekly export sales for the current marketing year for the period ending August 18 totaled 275,900 running bales, according to USDA data. The next weekly export report will be released tomorrow, September 01, at 20:00 GMT. The USDA reported the adjusted world price (AWP) of upland cotton at 58.81 cents per pound.

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A stronger dollar and the arrival of needed rains in Texas have prompted traders to liquidate their cotton positions, sending the fiber to multi week lows.

The most active December Cotton #2 contract on the ICE declined by 0.71 cents (1.07%) to settle at 65.58 cents per pound on Wednesday, touching a low of 65.41 cents during the session. The March 2017 contact declined 0.66 cents (0.99%) to settle at 66.01 cents per pound.

From the middle of July through early August, cotton for December delivery soared, touching a high of 77.98 cents per pound on August 05.

Though supply concerns have eased in the US, The Wall Street Journal reports that India, the world’s largest cotton producer, has signed agreements which will bring their total cotton imports for the year to around 2 million bales due to a challenging planting season.

The USDA’s weekly crop progress report released on Monday after the market closed showed that 48% of US crops were in either good or excellent condition, a slight improvement from the 47% figure reported the previous week.

Weekly export sales for the current marketing year for the period ending August 18 totaled 275,900 running bales, according to USDA data. The next weekly export report will be released tomorrow, September 01, at 20:00 GMT.

The USDA reported the adjusted world price (AWP) of upland cotton at 58.81 cents per pound. This figure will be updated tomorrow, September 01, at 20:00 GMT.

The Cotlook ‘A’ Index for August 30 was down 1.00 cent to 76.30 cents per pound.

The US dollar index was down 0.05% today to 96.009.

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Brent Lantzy
Writing is in my DNA. That is, I don’t know why I've always had the inclination to write, or why I’ve always been particularly good at communicating effectively through the written word. It is simply a part of who I am. Now, I’ve turned this skill into a business, lending my best writing efforts to professional projects requiring a unique, creative, and human touch.

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