By Duane Howell DTN Cotton Correspondent
U.S. export commitments reached 91% of the forecast and shipments climbed to 61%. China’s February imports fell 38.5% from a year ago, while preliminary March manufacturing figures quickened. Cotton futures extended a selloff in sluggish activity Thursday as global stock markets fell amid fears of a potential banking collapse in Cyprus and renewed concerns about growth in the euro zone.
Spot May closed down 90 points to 88.20 cents, in the lower reaches of its 114-point range from unchanged at 89.10 down to 87.96. It closed below its nine-day moving average for a second day. July fell 80 points to 89.15 cents and December dropped a modest 16 points to 87.82 cents. The selloff started on selling attributed largely to the looming speculator-index-fund roll and profit-taking ahead of next Thursday’s U.S. prospective plantings report.
Volume slowed to an estimated 18,700 lots from 26,383 lots the previous session when spreads totaled 8,568 lots or 33%, EFP 339 lots and EFS 200 lots. Options volume totaled 3,313 calls and 2,626 puts. Net all-cotton export sales for shipment this season of 154,100 running bales during the week ended March 14 boosted 2012-13 commitments to 11.305 million RB, according to data reported by USDA.
This is 198,000 bales or 1.7% behind commitments a year ago and is 91% of the USDA export projection. Commitments at the corresponding point last season were 101% of final shipments. Sales, down from 232,500 bales the previous week, were in line with most expectations for a reporting week in which current-crop prices hit several new highs for the move. Commitments during the previous six weeks swelled a bulging 2.576 million bales.
All-cotton shipments of 287,500 running bales, against 373,600 the previous week, brought exports for the season to 7.495 million. Shipments are 1.288 million bales or 21% ahead of exports a year ago. To achieve the estimate, shipments need to average roughly 256,500 running bales a week. Sales of around 56,000 RB a week would match the shipment estimate without regard to quality mixes or a bridge to the volume movement of new-crop supplies.
New-crop sales rose to 81,600 bales from the previous week’s 50,300, hiking 2013-14 commitments to 1.119 million. Cumulative new-crop sales are 303,000 bales ahead of forward bookings a year ago.
Meanwhile, China’s cotton imports totaled 378,835 metric tons (1.74 million bales) in February, down 38.5% from the corresponding month last year, Dow Jones Newswires reported, citing General Administration of Customs data.
Imports in January-February fell 11.3% to 836,310 tons (3.84 million bales), the customs data showed. Separately, preliminary Chinese manufacturing figures for March showed a quickening, viewed as a sign of gradual recovery in the world’s second biggest economy.
HSBC’s purchasing managers’ index came out at 51.7, compared with a final 50.4 in February. The pick-up in March indicated that the sluggish activity in February could be because of the seasonal effect of Lunar New Year holidays rather than the start of a downtrend.
Futures open interest fell 2,536 lots Wednesday to 210,203, with May’s down 3,870 lots to 136,121, July’s up 689 lots to 37,989 and December’s up 640 lots to 34,528. Cert stocks increased a bale to 421,373. Awaiting review were 3,600 bales. World values as measured by the Cotlook A Index fell 200 points Thursday morning to 95.55 cents. The premium to Wednesday’s May futures settlement widened three points to 89.10 cents.
(Source: AgFax.com)