Price Picture
Notes
ICE cotton dollar prices for July-15 closed around 190 points lower this week as prices finished at 61.19. The Dec-15 contract finished at 62.59. Open interest for July-15 is at 33,570 contracts. Dec-15 open interest is at 33,076. U.S. certified cotton stocks equaled 6,974 while U.S. net export sales were at 36,800 RB. Managed money is net long. Short-term, technical traders see possible support around 60.00 with possible resistance around 62.20. Prices are below the long-term trend.
Price
July-15 is at: 61.19
Dec-15 is at: 62.59
Cotlook ‘A’ Index is at: 67.25
July-15 is at: 61.19
Dec-15 is at: 62.59
Cotlook ‘A’ Index is at: 67.25
Cash Sales
For 3/13/2015, the trading platform TheSeam.com reported an average cash price of: 53.84.
On July, that puts the average basis right at: –7.35 points.
Cash prices are averaging 11.38 cents over loan value.
For 3/13/2015, the trading platform TheSeam.com reported an average cash price of: 53.84.
On July, that puts the average basis right at: –7.35 points.
Cash prices are averaging 11.38 cents over loan value.
Stocks and Sales
ICE Certified Cotton Stocks = 6,974
US Net Upland Export Sales = 36,800
(China was the big buyer at 20,300.)
Current World Balance Sheet (2014/2015)
(China was the big buyer at 20,300.)
Current World Balance Sheet (2014/2015)
Beginning Stocks: 101.71 (million 480 lb. bales)
Production: 119.24
Supply: 220.95
Mill Use: 110.96
Ending Stocks: 110.06
Ending Stocks/Mill Use Ratio: 99.19%
Current China Balance Sheet (2014/2015)
Current China Balance Sheet (2014/2015)
Beginning Stocks: 62.71 (million 480 lb. bales)
Production: 30.00
Imports – Exports: 7.25
Imports – Exports: 7.25
Supply: 99.96
Mill Use: 35.00
Ending Stocks: 64.96
Ending Stocks/Mill Use Ratio: 185.60%
Current India Balance Sheet (2014/2015)
Current India Balance Sheet (2014/2015)
Beginning Stocks: 11.52 (million 480 lb. bales)
Production: 30.50
Imports – Exports: -3.10
Imports – Exports: -3.10
Supply: 38.92
Mill Use: 24.00
Ending Stocks: 14.92
Ending Stocks/Mill Use Ratio: 62.16%
Current USA Balance Sheet (2014/2015)
Beginning Stocks: 2.45 (million 480 lb. bales)
Beginning Stocks: 2.45 (million 480 lb. bales)
Production: 16.08
Imports – Exports: -10.69
Imports – Exports: -10.69
Supply: 7.84
Mill Use: 3.65
Ending Stocks: 4.2
Ending Stocks/Mill Use Ratio: 115.07%
Commitments of Traders
Producer / Merchant
Producer / Merchant
- Long: 16,426 (Contracts)
- Short: 109,577
Swap Dealers
- Long: 52,888
- Short: 5,056
Managed Money
- Long: 60,773
- Short: 26,934
Other Reportables
- Long: 22,867
- Short: 13,372
Cotton Price Model: 60.3 cents
A regression model, like the one located here can give insight into how prices, on average, would react given a change in one or more fundamental supply or demand factors. A proper interpretation of this price model would be:
“Over the last number of years, if cotton supply and demand were at their current levels, we would – on average – expect the US price of cotton to be approximately: 60.3 cents.”
(*Note: This model does not attempt to forecast the future direction or level of cotton prices.)
(*Note: This model does not attempt to forecast the future direction or level of cotton prices.)
General View
Bearish.
(Keep in mind that while this is a weekly letter, I can easily change my mind in 24 hours.)
This letter archive can be found by clicking, here.
If this email was forwarded to you and you’d like to sign up, email me at sterlingterrell@hotmail.com with “Cotton Club” in the subject line. Email with “Stop Cotton” in the subject line to be removed.
*This is for informational purposes only, and not a recommendation to buy or sell.
*This is for informational purposes only, and not a recommendation to buy or sell.
There is substantial risk of loss to futures and options trading.
Past performance may not be indicative of future results.
One should carefully consider their financial suitability prior to trading futures or options.
