Wt Cotton Discussion Threads

[kaos3] 07/2/2017 08:22

should I buy?

[bobdouthwaite] 08/3/2011 12:34

Cotton futures soar to all-time high on global supply fears
2011-03-07 13:20:34 GMT (Futures Pros)

Futures Pros – Cotton futures rallied to an all-time high for the second consecutive session on Monday, amid ongoing speculation tightening global supplies would fail to meet global demand.

On the ICE Futures U.S. Exchange, cotton futures for May delivery traded at USD2.1971 a pound during European afternoon trade, soaring 3.28%.

It earlier rose to an all-time high of USD2.1971 a pound.

Earlier in the day, the Australian Cotton Shippers Association said that buyers have already purchased more than 80% of the nation's coming cotton harvest in advanced sales.

According to Phill Ryan, director of the industry group, "The amount of so-called forward sales compared with usual levels are 50% to 60% higher this season".

He added, "The U.S. is the biggest exporter in the world and they are sold out. It's a worldwide scramble for limited supplies".

Australia is the world's fourth largest cotton exporter and is scheduled to begin shipments of this season's four-million-bale-harvest in April.

The world's largest cotton consumer China, which announced last week that 2010 cotton production declined by 6.3% to 5.97 million tons, purchased more than 40% of Australia's cotton shipments in the 2009-10 season.

Meanwhile, food and agribusiness financial service provider Rabobank said in a report on Friday, "Export commitments out of the U.S. continue at record pace, and due to the razor-thin expected ending stocks, demand must be rationed as there is not enough cotton."

Elsewhere, wheat futures for May delivery eased down 0.14% to trade at USD8.3125 a bushel, corn futures for May delivery added 0.14% to trade at USD7.2888 a bushel, while soybeans for May delivery climbed 0.11% to trade at USD14.1488 a bushel during European afternoon trade.

[bobdouthwaite] 01/3/2011 11:53

I hope you got back in Mozart? The market manipulation across ag commodities (to allow the Egyptians to buy wheat more cheaply?) was short and very sharp and a good example of why I gave up using stops. For the moment, the price is heading in one direction only.

And keep an eye on wheat - severe drought in China (but did it get rain last week-end?) and early problems on the North American prairies.

[mozart999uk] 23/2/2011 14:57

Drat, stopped out. Should have lowered my stop loss I think in order to let it breathe.....

Will watch and see what happens tomorrow.

[mozart999uk] 21/2/2011 14:20

Thanks for your message. sounds like a very good strategy to me.:-) Good luck!

[mozart999uk] 21/2/2011 11:47

Hi Bob. Probably not the best person to ask, I got in on a tip and started researching afterwards. Not the best :-)

Original thoughts were to watch Chinese demand as economy showed no signs of slowing. However, with recent measures to curb inflation I'm wondering whether demand will drop.

Original aim is for 10% increase. When that's reached I'll drag up my stop loss and anything over 10 is a bonus :-) Got quite a tight stop loss on this at the moment. Based on conflicting news.


This on the subindex

"iPath DJ-UBS Cotton TR Sub-Idx ETN (NYSE: BAL) down 12.2% to $97.50. Making an incredible drop today as industry researcher Cotlook Ltd., said that production in 2011 will exceed demand by 1.2 million metric tons starting August 1, 2011. The ETF may also have further to fall, as original supply constraint concerns drove shares up from the mid-$30s in July 2010 to over $110 recently."

How bout yourself?

[bobdouthwaite] 18/2/2011 15:32

Hi Mozart, what's your strategy here? I'm leveraged so have been cautious and selling off lately, but to-day's Times suggests I should hold for the moment:

"...cotton futures in New York have been hovering below $2 a pound in New York, although some believe they will rise as high as $5. Gary Mead, editor of WorldCrops.com, an excellent website tracking soft commodities, reckons that is a bit extreme, but that $3 is a real possibility...."

[mozart999uk] 17/2/2011 14:58

Thanks for that. Looking good :-)

[bobdouthwaite] 17/2/2011 12:28

There's no stopping it just yet:

[bobdouthwaite] 11/2/2011 16:41

From Agrimoney:'Sense of panic' puts $2-a-pound cotton in sight

Analysts, warning of a "sense of panic" over export supplies, forecast cotton prices hitting a record $2 a pound, even as most of the fibre's futures complex weakened on Friday.

"It seems only a matter of time before the $2 mark is taken," Commerzbank analyst Eugen Weinberg said. "The price of cotton still only knows one direction."

At Macquarie, Kona Haque also said it was likely that New York cotton futures would reach $2 a pound for the first time.

The comments came as the benchmark March futures gained further ground, standing 0.6% higher at 188.7 cents a pound at 11.15 GMT, after earlier touching a record for a spot contract of 192.63 cents a pound.

However, later lots eased, with the December lot, the benchmark for the next 2011-12 harvest, down 1.5% at 129.50 cents a pound.

Farmer hoarding?

The diverging fortunes of the contracts reflected "the fact that right now, concern is all about the short term", Ms Haque told Agrimoney.com.

American shipments remained strong, with latest weekly export sales coming in at a higher-than-expected 305,000 running bales, a pace that has raised expectations among some investors that US stocks may end 2010-11 below even the 50-year low of 1.9m bales currently forecast.

"There is clearly a sense of panic that this pace [of exports] cannot be kept up," she said.

However, sourcing alternative supplies had got more difficult, with floods damaging the crop in Australia, and India reportedly reluctant to raise export quotas in the face of a slowdown in deliveries from growers.

This decline has been blamed on rains damaging Indian production, although there is growing talk of farmer hoarding, in expectation of higher prices.

Meanwhile, demand remains strong from Chinese mills, which are still enjoying positive margins even after the jump in costs of their main raw material.

Correction ahead?

The high prices are stoking expectations of a rapid rise in sowings in the US, the major exporter, for the forthcoming season.

"Many farmers sold their last crop ahead at 80 cents a pound," Ms Haque said.

"They are keen to take advantage of current prices. They will plant as many acres as they can."

However, Rabobank warned that the world needed a record cotton crop in 2011-12 "just to maintain the current tight fundamentals".

"An inadequate harvest would likely result in continued record highs," the bank said, adding that the likely scenario was for a "correction in prices" later in the year, assuming the next crop avoids weather scares.

[bobdouthwaite] 25/1/2011 17:59

From iii:

Cotton prices reach all-time high
Tue, 25/01/2011 - 11:53 | Fiona Bond

Cotton prices shot to an all-time high on Tuesday, fuelled by fears of a global cotton shortage.

The agricultural commodity hit $1.638 per pound - the highest in the 141 year history of the New York exchange.

The sharp rise came as stocks fell to an astonishing low, with ICE warehouse inventories housing 125,520 bales - less than 1% of the number of contracts for delivery ahead of the US harvest.

The US - the world's largest exporter of cotton - is estimated to have sold up to 90% of last year's crop and stocks, according to the American Cotton Shippers' Association.

Carsten Fritsch, analyst at Commerzbank, said: "A look at China is enough to drive prices to greater heights. High international demand - not only from China - has already absorbed stocks on a global scale and especially in the US."

The fibre has risen some 131% in the past year alone, as mill demand rebounded following the deep recession and India curbed shipments in a bid to boost its domestic textile industry.

Growing Chinese demand has only served to exacerbate the situation, with the latest customs data showing that China's imports rocketed in 2010 by 86% year-on-year to 2.84 million tonnes after the domestic crop proved disappointing.

Fritsch added: "The high price level makes it likely that the cotton acreage will be expanded significantly in the current year. According to estimates, this expansion could be about 12-15% in the US after a similar rise was registered already last year."

Washington-based intergovernmental group the ICAC will meet with diplomats and officials next month to discuss the volatility and work towards creating transparency in government policies and programmes affecting the fibre.

[bobdouthwaite] 06/1/2011 15:05

Better harvest predicted.... but not just yet!

21:17 UK, 5th January 2011, by Agrimoney.com
Queensland floods pave way for 'huge' cotton crop

The cotton farms knocked particularly badly by Queensland's "widespread and devastating" floods look set to reap a silver lining from a "potentially huge" crop next season, a leading analyst has said.

Cotton and sorghum, of which Queensland is one of only two main Australian producing states, have suffered a "significant negative impact" from the flooding which has effected some 1m square kilometres - an area twice the size of Spain, and approaching the combined size of California and Texas.

"There are various anecdotal reports of complete crop failure due to waterlogging," Commonwealth Bank of Australia analyst Luke Mathews said, noting that the floods had hit these summer crops during the vegetative stage, unlike the main grains, which had been largely harvested.

The comments came as Australian Agricultural Company (AAco) followed PrimeAg Australia in reporting crop damage from floods, with 60% of the crop at its Goonoo operation estimated lost.

'Bumper crop ahead'

With Queensland typically producing up to 40% of Australian cotton output, the domestic crop now no longer looked set to reach the 4.4m bales estimated by industry group Cotton Australia last month, if potentially still capable of breaking the record of 3.5m bales set a decade ago.

However, while "devastating" for many farmers in the short-term "the current dark clouds come with a longer run, silver lining" thanks to the recharging of soil moisture levels, Mr Mathews added.

This would in northern New South Wales as well as Queensland "help underpin" the forthcoming autumn sowing season for many grains, and boost pasture growth at livestock farms in the first half of the year.

Furthermore, "overflowing irrigation storages will underpin the 2011-12 summer cropping campaign", he said.

"Abundant irrigation water availability, combined with current futures pricing, suggests a potentially huge national cotton crop in 12 months' time."

New York cotton, which hit a record high of 159.12 cents a pound last month, closed 1.0% higher at 145.20 cents a pound, for March delivery.

[sllab101] 30/12/2010 18:06

Hey Bob, thanks very much and the best of luck.n

[bobdouthwaite] 30/12/2010 17:38

Sorry sllab, I don't. The link opens OK with me, but here's the full text anyway. I see it cites Bloomberg, but I didn't see the story there.......


Australian flooding to negatively impact nation's cotton harvest

Dec 29, 2010 11:51 AM
0
inShare

A Southeast Australia region whose production of cotton is high will suffer reduced harvesting of the soft fiber because of flooding, according to Bloomberg.

More than 18,500 acres of crops in Theodore have been ruined as a result of heavy rainfall, according to David Bone, lead spokesman of Cotton Australia of Sydney. Australia is the globe's fourth-biggest exporter of the soft commodity. Theodore is part of the state of Queensland.

"Around Theodore, crop has been washed away," Bone told Bloomberg. "There would be losses in other areas but you need the water to go off the land and for the crop to attempt to recover before you can really say what the situation is."

Cotton for March 2011 delivery slipped 0.0036 cents to settle at $1.44 per bushel just before 1 p.m. Eastern Standard Time in New York.

Chinese demand for the soft commodity pushed up cotton's price to record value last week amidst conjecture that demand would trump supply.

The Meteorology Bureau reports Australia's spring, from September to November, was its wettest thus far.

[sllab101] 30/12/2010 15:57

Hi Bob, do you have another link to this as I can't get this one open.Thanks.n

[bobdouthwaite] 30/12/2010 15:06

I've been moving out of cotton, but this story suggests a rethink is in order:

[sllab101] 20/12/2010 09:35

In demand

Cotton, a key indicator of thinking on commodities demand in China, the biggest consumer and importer of the fibre, was also strong, adding 2.7% to 154.10 cents a pound in New York for March delivery, although gains were more muted further along the futures curve.

Luke Mathews at Commonwealth Bank of Australia noted the cotton market's "continued focus on the near-term supply squeeze", with economic recovery boosting demand at a time when many countries have had disappointing crops, America, the top exporter, included.

"Cotton output in China's Shandong province, the nation's second largest producing region, fell 22% in 2010 because of a serious of natural disasters," Mr Mathews noted.

[sllab101] 20/12/2010 09:34

CHENNAI (By Seshadri Ramkumar):The Cotton Association of India (CAI) has lowered its estimate for 2010-11 cotton season to 34.7 mn bales ((347.50 lakh bales) of 170 kg each as of November 30, 2010 as against 35.7 mn bales it forecasted in October.The CAI has 446 members from the industry spanning the entire value chain in India.

The unseasonal rains in the cotton growing zones in India during November, particularly floods in Andhra Pradesh have resulted in lowering the crop estimate.

Gujarat, the largest cotton growing state in India is now estimated to produce 11.6 million bales which is 400,000 bales short from the previous estimate. Andhra Pradesh is estimated to produce 6 million bales. Earlier estimate for this state was 6.55 million bales. The central zone, which comprises of the states of Gujarat, Maharashtra and Madhya Pradesh, is estimated to have lost 300,000 bales. The floods in Andhra Pradesh have decreased the output in this state by 550,000 bales. The loss from the Central Zone and Andhra Pradesh now stands at 850,000 bales, which is a major factor for the decline in the 2010/11 estimate.

As of the latest report, CAI's estimate stands at 34.75 million bales, which is however higher than the Cotton Advisory Board's (CAB) estimate of 32.5 million bales. One point to be taken into account is that the decision by Government of India will be based on the CAB data, which is lower than the latest estimate by CAI.

In addition to the lowered estimate, spinning mills are also concerned about the loss in quality of cotton due to rainfall and floods. One manager who is in-charge of cotton purchasing of a large textile mill group briefed this scribe that the quality loss may be upto 10% due to weather related issues.As of today, there is no indication as to when a new crop estimate will be released by India's Cotton Advisory Board. (The writer is Associate Professor at Texas Tech University)

[sllab101] 04/12/2010 18:02

Cotton Has Biggest Weekly Gain in 39 Years
By Leslie Patton - Dec 3, 2010 9:28 PM GMT+0000



Cotton futures surged, heading for the biggest weekly gain in 39 years. Photographer: Ian Waldie/Bloomberg

Cotton prices surged, capping the biggest weekly gain in 39 years, on mounting concern that exports will be limited from India, the world's second-largest grower.

Cotton-yarn shipments will be capped at 720,000 metric tons in the year that started Oct. 1 in a bid to stabilize domestic prices and boost supply, the Indian government said Dec. 1. Futures in New York have soared 75 percent this year as demand in China climbed and inventories plunged in the U.S., the top exporter.

[jackpipe] 26/11/2010 13:29

the chart's a classic, looks like it needs to go all the way back to 2.00 eventually.

[bobdouthwaite] 24/11/2010 16:50

I'm nervous but somewhat reassured - how's the short Rocket Mn ?

DJ MARKET TALK: ICE Cotton Soars On Weakened Dollar, Tight Supplies
11/24/10 10:15:03 EST

[Dow Jones] ICE cotton futures soar Wed as US dollar weakens, concerns remain
over tight supplies. Cotton for March delivery gained 3.9% to $1.1615 a pound.
Anyone who wants to sell already has, says John Flanagan of Flanagan Trading
Group, pointing to recent selloff after futures hit record high Nov 10. The ups
and downs "have not created more cotton, just more anxiety," he says. Dec
contract rises 6.11% to $1.20 a pound.

[bobdouthwaite] 23/11/2010 08:24

Well I'm still (mostly) here - as is demand for cotton, so we'll see who's right ;)

[rocket mn] 22/11/2010 21:19

Fully out now, been a good ride, time to look at SCTO