Cotton Market Fractionally Lower Monday
Jun 12, 2023
The cotton market was fractionally lower Monday. Traders continue to monitor the weather and are waiting on the outcome of the Federal Reserve's two-day meeting.
The cotton market was fractionally lower Monday. Traders continue to monitor the weather and are waiting on the outcome of the Federal Reserve's two-day meeting.
With its recent rains, West Texas has seen some improvements. This situation is evidenced by the latest U.S. Drought monitor assessment. Regarding future weather events, the six- to 10- and the eight- to 14-day outlooks both indicate below-normal precipitation, with above-normal temperatures. Additionally, the U.S. Climate Prediction Center has confirmed that El Nino conditions are unfolding, which could translate into increased rainfall from Texas to the Georgia coast.
Monday afternoon, USDA will issue its crop progress data. Last week showed the 2023 crop some 71% planted versus its historical pace of 75% complete for this time of year.
The Federal Reserve will meet Tuesday and Wednesday concerning U.S. interest rates. Currently, traders are fairly divided between those who expect to see another quarter-point hike, and those who favor a "pause." However, also Tuesday, the Fed will see fresh CPI numbers (consumer inflation). If that data is considered "hot," then likely the central bank will indeed hike rates.
The CFTC issued its Commitments of Traders data last Friday. The numbers showed that managed-money funds were net buyers of 2,560 contracts. That action increased their net long position to 4,070.
Monday, July settled at 83.49 cents, down 0.55 cent and December 2023 ended at 81.32 cents, 0.50 cent lower. Estimated volume was 52,859 contracts.