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Cotton futures and options quick facts:
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50,000 pound contract
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One cent move equals $500
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Trades March, May, July,
October, December
2/3/12 Cotton futures prices traded mostly sideways
this week as the U.S. dollar is continuing its
slide. The USD is now down 3 full basis points over
the last few weeks which is helping to push many
commodity markets higher. Friday's strong jobs
report is also helping commodity prices strengthen.
It also seems that bad European Union headlines are
having less affect on the markets and the worst case
may already be factored into many of these markets.
1/27/12 Cotton futures prices are trading mostly
higher again this week. The bullish news was the
weakening U.S. dollar that continues its 2 week
slide of about 3 full basis points which helps push
dollar denominated commodity markets higher. The
FOMC meeting left rates unchanged and opened the
door for more quantitative easing by the Federal
Reserve Bank. European sovereign debt issues and
saber rattling from Iran seemed to have little
affect on the markets.
1/20/12 Cotton futures prices traded mostly higher
this week as the recent influx of capital from hedge
funds and other large speculators into the commodity
markets and especially the soft sector pushed many
commodity markets higher. The recent successful debt
auctions from Spain and France helped stabilize the
European Union for the near term and in turn weaken
the U.S. dollar.
1/6/12 Cotton futures prices traded mostly sideways
to down this week. The U.S. dollar rose to new
contract highs as concerns over European banks
pushed the Eurocurrency down to a 16 month low. New
tensions with Iran and its nuclear program has
pushed American and British aircraft carriers to
enter the Persian Gulf and the Straits of Hormuz and
in turn pushed crude oil prices to the highs.
12/23/11 Cotton futures prices traded mostly
sideways this week while many other commodity
markets rallied as the U.S. dollar sold off from its
contract highs in the thin volume holiday trade that
is typical for this week and next. Iran tensions
pushed oil higher and positive economic reports out
of the U.S. and Europe also pushed investors back
into risk assets like stocks and commodities.
12/16/11 Cotton futures prices sold off this week
along with most other commodity markets. The lack of
an additional quantitative easing announcement by
Bernanke and the Federal Reserve Bank at the FOMC
meeting surprised some market participants and
pressured the markets. More bad news out of Europe
and very positive news from the U.S. economy pushed
more assets in to the U.S. dollar as it hit another
high kept the stock markets trading down to sideways
as well.
12/9/11 Cotton futures prices traded mostly down
this week again as most of the commodity and stock
markets took their directional cues from the
European headlines again. In other words, bad news
out of the European Union pressured the markets and
good news helped push markets higher. The week ended
on a positive note as the European Union summit
yielded ideas of tightening anti-deficit rules and
punishments for member countries. This heartened the
markets as it symbolized the idea that forced
accountability of member nations may curb government
spending.
12/2/11 Cotton futures prices traded sideways this
week along as many other commodity markets rallied.
Crude oil broke through $100 a barrel as Iranian
students broke into the United Kingdon embassy in
Tehran. Positive job growth in the U.S. and other
encouraging economic data helped many commodities
push higher. Also adding to the bullish tone was
stability in Europe as a concerted effort by 5
central banks to add liquidity to Europe eased some
fears and a sell off in the U.S. dollar also helped
commodity prices.
11/25/11 Cotton futures prices traded mostly down
along with the majority of the commodity markets.
The U.S. dollar index rallied almost to its October
4th high which is coincidentally when many commodity
markets' made their recent contract lows. The recent
German bond auction was a failure and couldn't
managed to sell all of the bonds issued as more
problems out of Italy and Greece hurt the European
Union as investors flee to cash and the U.S.
treasury markets.
11/18/11 Cotton futures prices traded mostly
sideways as more problems came out of the European
Union suppressing most commodity rally attempts. The
talk of Italy potentially defaulting on its debt and
Italian bond yields breaching the critical 7% area
hindered most bullish support for most markets. The
European Central Bank chose to purchase Italian and
Spanish bonds to support the markets and prove that
they would support the teetering European Union and
its weak links from default.
11/4/11 Cotton futures prices traded mostly sideways
to down this week as more uncertainty about Greek
and Italian solvency added to European Union woes.
Also adding to the uncertainty was the bankruptcy
declaration by MF Global who supposedly was
overleveraged in European high risk assets and it
was a very bad bet. This uncertainty pushed assets
towards the U.S. dollar and U.S. treasuries pushing
both higher on the week. The strong dollar often
depresses dollar denominated assets like
commodities.
10/14/11 Cotton futures prices continue to trade
sideways again this week in spite of the positive
rhetoric out of the European Union and the idea that
the EU has plenty of assets to back up its support
of failing economys like Greece, Spain and Italy has
led investors back into stocks and commodities. The
U.S. dollar continues its fall which is also helping
out the dollar demoninated commodity markets become
more bullish.
10/7/11 Cotton futures prices are trading sideways
this week near its lows. The market moving news of
the week was Moodys' cutting the senior debt and
deposit ratings of 12 UK financial institutions
while at the same time the European Commission put
together a possible coordinated European bank
recapitalization plan to stabilize weak links in the
financial chain like Greece and Italy. Market
volatility continues to be extreme in stock and
commodity futures contracts.
9/30/11 Cotton futures prices are trading mostly
sideways to down this week along with most other
commodity markets as more problems with Greece and
its potential default to its bond holders and other
European woes has led to an extremely volatile
trading environment for stocks and commodity
investors. The U.S. dollar is also near its recent
highs which is also hindering the bulls for now.
9/23/11 Cotton futures prices sold off this week
along with just about every other commodity as more
problems out of the European Union and Federal
Reserve Bank chairman Ben Bernanke saying that the
U.S. economy was probably going to slip back into a
recession. This fear of a double dip global
recession sent investors fleeing out of the stock
and commodity markets around the globe and
strengthened the U.S. dollar significantly.
9/16/11 Cotton futures prices traded mostly sideways
to down this week along with most other commodity
contracts as more European soveriegn debt problems
(Greece) and more bad economic reports out of the
United States have come together to add more
uncertainty about the world's economic future. The
weakening U.S. dollar did little to prop up
commodity prices. Volatility can be extreme at times
as the market reacts to economic reports.
9/1/11 Cotton futures prices are trading sideways
this week in spite of the strengthening U.S. dollar
and the idea that the Federal Reserve Bank is
thinking about another round of quantitative easing
to stimulate the economy as interest rates should
remain low until 2013 if not longer.
8/19/11 Cotton futures prices had an extremely
volatile week along with most of the rest of the
commodity markets. The stock market indices were
quite volatile and affected most other asset classes
as European Union problems resurfaced again and put
many investors in doubt about future U.S. and global
growth prospects over the near term.
8/5/11 Cotton futures prices have been mostly
sideways this week. This week's main stories are
about Europe's continued problems and the
foreseeable end of the European Union as the PIIGS
continue to harm. A slower global economy and the
10% correction in the U.S. stock markets have many
commodity investors heading for the sidelines.
7/29/11 Cotton futures prices have been trading
mostly sideways this week as the United States faces
a political impasse on raising the debt ceiling.
This has led to talk about the U.S. losing its AAA
credit rating and potentially defaulting on its debt
obligations. The U.S. dollar is trading sideways
near its lows probably because things seem to be
even worse in Europe. Many of the other commodity
markets have also been trading sideways for the most
part.
7/15/11 Cotton futures prices sold off by about 15
cents per pound this week as Ben Bernanke left the
door open for QE3 or printing more U.S. dollars to
be used for buying treasuries to help buoy the
economy. Also the European Bank Authority said 8 out
of 90 banks failed their stress tests this week. 5
were from Spain, 2 from Greece and one from Austria.
The U.S. dollar sold off this week.
7/1/11 Cotton futures prices sold off by about 5
cents per pound this week is spite of the fact that
the U.S. dollar lost about 2 basis points once the
markets decided that the greek soveriegn debt issues
would be resolved for the short term in spite of the
agreement that most analyst share that Greece is
doomed to be bankrupt sooner or later. Many
commodity sectors look to be selling off such as the
precious metals, energies and grains seem to be
trending sideways to down over the near term.
6/24/11 Cotton futures prices are trading mostly
higher by about 15 cents per pound this week in
spite of the collapse in crude oil prices. The Obama
administration decided to release 30 million barrels
of oil from the strategic petroleum reserve to help
pressure energy prices. The International Energy
Agency plans to add 2 million barrels a day from
non-OPEC reserves. Also pressuring the markets is
the idea that Greece will default sooner or later
and may be released from the European Union in order
to strengthen the Euro. Reports of slower growth out
of India and China is also pressuring commodity
prices in general.
6/10/11 Cotton futures prices are trading mostly
down this week to the tune of about 10 cents per
pound. Cotton is trading in a sideways to down
pattern currently and volatility has been coming
down which makes option premiums shrink as well.
6/3/11 Cotton futures prices rallied this week in
spite of quite a bit of bad U.S. economic data in
manufacturing, housing and jobs has consumer
confidence falling along with the stock market and
most of the commodity markets. Many economists fear
a soft patch in the economy this summer and a
slowing of Asian demand for many commodities as
attempts to battle inflation by raising rates are
slowing growth.
5/27/11 Cotton futures prices are trading sideways
along with most of the other commodity markets as
large speculators such as hedge funds seem to be
exiting the riskier assets. The lack of aggressive
buying and selling of these futures contracts has
caused many of them to trade sideways in small
trading ranges. The recent 3 cent rally in the US
dollar should have been more of a catalyst pushing
commodity prices higher but this has largely been
ignored. This is most likely caused by the
perception that China's economy may be slowing down
as well.
5/20/11 Cotton futures prices are trading sideways
this week as the US dollar continues to strengthen
and investors seem to be heading for the exit when
it comes to their riskier assets and are getting in
to cash and cash equivalents. The volatility in many
markets has dropped considerably as some like
silver, gold, crude oil and cotton are consolidating
sideways. This in turn is bringing option premiums
back down to more normal levels for some markets as
this volatility premium is taken out of the options.
5/13/11 Cotton futures prices sold off again this
week as the market digests the idea that Greece may
default on its debt just a year after this same
predicament that forced Germany to infuse money into
the system. This news crushed the Euro Currency and
pushed the US dollar higher which in turn hurt most
commodity prices and pushed volatility much higher.
Quantitative easing is set to end this summer which
might be why the stock market is soft in spite of
energy prices coming down violently. Option premiums
are very high for most commodities because of the
recent volatility.
5/6/11 Cotton futures prices sold off this week
along with most of the other commodity markets. A
cocktail of bearish happenings have been a catalyst
initiating a huge exodus out of risk assets to
reduce investors' risk exposure. The ECB president
Trichet let the market know that a ECB rate hike is
not a done deal in July which in turn pushed the US
dollar up a full basis point. Also hitting the
markets were the CME group's increase in silver
margin requirements which totalled 5 increases over
the last 2 weeks which pushed weak longs out of the
market and caused silver to correct by about 25%
making it the worst sell off since the early 1980's.
Lastly, many US economic reports have been weaker
than expected which is weakening the confidence of a
strong economic recovery in the US over the near
term.
4/29/11 Cotton futures prices lost about 10 cents
per pound this week. The FOMC meeting left Bernanke
signalling that QE 3 would not happen and QE 2 would
end in June and that interest rates will probably
stay on hold for a while leaving the US dollar to
get crushed as other countries plan on continued
interest rates hikes to fight inflation and attract
foreign assets to the stronger currencies.
4/22/11 Cotton futures prices sold off this week by
about 10 cents a pound as most of the other
commodities rallied as the US dollar hit levels not
seen since the "Great Recession" summer of 2008. The
market seems to be factoring in an unwillingness by
the United States' federal reserve bank to raise
interest rates in spite of the fact that many other
economies like Australia, China and the European
Union are raising interest rates. This rising
interest rate environment draws money away from US
investments into stronger currency assets.
4/8/11 Cotton futures prices rallied about 20 cents
per pund this week along with many other commodity
markets as the bulls seem to have control for now.
Gold hit an all time high and crude oil broke
through $110 a barrel pulling other commodities with
them. The US dollar coincidentally hit new contract
lows this week as well. The new earthquake in Japan
seems to be a non-event this time for the markets.
4/1/11 Cotton futures prices have been trading
sideways around $1.97 level along with the rest of
the soft markets. The softs had been the stand out
sector recently with many hitting record highs along
with cotton. Cotton option premiums are high.
3/25/11 Cotton futures prices were mostly higher
this week based on the fact that the risk trades
like commodities were the weekly theme. The Japan
nuclear scare seems to have been averted for the
most part and the markets factored in a worst case
scenario which caused the massive sell off last
week. The tensions in the Middle East seem to be
growing which pushed crude oil prices over the $105
level. The US dollar has been sliding for most of
the month of March which is also helping push most
commodity futures prices higher. The March 31st
prospective plantings report might be a big market
mover is cotton acreage slips.
3/18/11 Cotton futures prices came down this week
along with most of the commodity and stock markets
as investors try to figure out what affects the
tsunami and its destruction of the cities and
nuclear plants in Japan will have over the short,
medium and long terms. Japan's economy is the 3rd
largest in the world and demand destruction for some
commodities may occur.
3/11/11 Cotton futures prices are coming down this
week after a volatile few weeks in the commodity
markets. Geopolitical issues in the Middle East put
the bias in the commodity markets in the hands of
the bulls for the last few weeks but the buy the
rumor sell the fact side of the equation and China's
first trade deficit in many years seems to be behind
the massive liquidation of most of the commodity
markets. An aggressive increase in planted acres
around the globe will possilbly lead to production
outpacing consumption which should also pressure
prices.
3/4/11 Cotton futures prices rallied again this week
by about 20 cents per pound as the world wonders
about the violence and ubiquitous unrest in northern
Africa and the middle east. Egyptians got rid of
their despot. Libya is trying along with Bahrain,
Tunisia and others which is pushing crude oil prices
sky high again. Higher oil prices are very
inflationary and helps push the bias of all dollar
denominated commodities higher.
2/11/11 Cotton futures prices continue to rally with
most of the soft markets this week. The uprising in
Egypt by the people to oust the long time president
out of power has turned violent and caused many
commodity markets to become very volatile because of
the belief that turmoil may spread to other Muslim
countries near Egypt. On February 10th the ousted
president appointed his vice president as ruler much
to the dismay of the protesters.
2/4/11 Cotton futures prices rallied this week as
worry about the Egyptian uprising spreading to other
Muslim countries had the markets on edge. In spite
of the Suez canal being only responsible for about
3% of the oil shipping, the oil markets rallied and
pulled many other markets higher as well. The idea
that inflation and especially food and energy
inflation is starting to get traction in the media
and may have a significant impact of the economy
soon.
1/28/11 Cotton futures prices hit another high this
week as global supplies do not seem sufficient
enough to meet demand. These record high prices have
begun to slow demand in some areas but the petroleum
based alternatives such as nylon, rayon and
polyester are still expensive because of crude oil
prices being in the $80s.
1/21/11 Cotton futures prices bucked the trend of
most of the other commodity markets as they sold off
violently in anticipation that China will step up
its efforts to quell inflation by making it harder
to get money out of its main banks by increasing
reserve requirements and raising interest rates.
1/7/11 Cotton futures prices are still near the
upper end of its recent record setting range in
spite of the recent strength in the US dollar and
the idea that China, the top importer of cotton, is
expected to decrease imports by 28% in 2011. Most of
the other commodities have been coming down to start
the new year.
12/24/10 Cotton futures prices came down this week.
The week before and after Christmas are notoriously
thinly traded and the markets can have very volatile
price swings because of the lack of trading volume.
Many money managers call it quits for the year in
early December to lock in before year end.
12/17/10 Cotton futures prices rallied near the
highs again this week as India restricts exports to
make sure the is enough supply for its domestic
needs. This rally is occurring in spite of the fact
that the US cotton crop is looking near perfect in
most parts of the country.
12/3/10 Cotton futures prices have been running up
and down violently this week as the European Union
has decided to give Ireland the loan it needs so
that it won't have to default on its debt. Also
helping the market is the idea that the worst of the
problems in the United States are in the past and
its economy will likely begin to grow at a better
pace than expected. There is also the idea that
capital gains taxes and taxes on dividends will not
be implemented now that republicans are in charge.
11/19/10 Cotton futures prices sold off again this
week as China raised interest rates in an attempt to
slow its overheating economy and inflation. Also
pressuring the commodity markets was the idea that
Ireland may default on loans might lead to more
Eurozone economic problems coming soon.
11/12/10 Cotton futures prices are correcting
significantly after the huge run up in prices. The
most prevelant perception is that the global
recovery may be stalling based on worse than
expected economic reports as of late and the idea
that China will hike interest rates to battle
inflation which should push commodities lower.
11/5/10 Cotton futures prices are still heading
higher as the FOMC meeting yielded more quantitative
easing by the Fed. Printing more money should lead
to high inflation or hyperinflation for the next few
years. Especially when you consider the fact that
the Fed bought so much of the toxic real estate
assets from Freddie Mac and Fannie Mae. It makes
sense that they won't raise rates to fight inflation
because it would cost the government billions of
dollars.
10/22/10 Cotton futures prices hit all time highs
this week in spite of the rally in the US Dollar and
corresponding commodity sell off. Strong exports
especially from China are still lifting the market.
10/15/10 Cotton futures prices hit new highs not
seen since the Civil War. The week US Dollar is
helping US farmers move their cotton and other
agricultural products because of the cheaper prices
for foreign buyers. Cotton options volatility
premiums are high.
10/8/10 Cotton futures prices hit new highs to
levels not seen since 1995 due to record exports of
US cotton. The recent USDA report showed cotton
production up to 18.9 million bales which is up 55%
form last year's 12.2 million bales estimate. The
weakening US Dollar is helping many US agricultural
products fetch higher prices.
9/24/10 Cotton futures prices are coming down a bit
this week and may have gotten ahead of themselves.
Weather problems around the world might make it hard
to come up with the 120 million bales overall demand
estimates this year.
9/1710 Cotton futures prices hit a new 26 month high
as cotton yields in the US are suspected to be poor
and commodity funds have been huge buyers of soft
commodity contracts like cotton, sugar and coffee
recently. Cotton options have very high premiums
right now.
9/10/10 Cotton futures prices continue to climb to
contract highs and multi year highs helped by recent
commodity fund buying of the food and fiber sectors
in an attempt to diversify away from equities using
non-correlated commodities. Many other commodities
like energies and grains have recently had a high
correlation to stocks.
8/20/10 Cotton futures prices are still near
contract highs this week as the hot dry weather in
the delta region of the U.S. persists. Also helping
prices is the fact that importers continue to buy
cotton even at these extremely high price levels.
Cotton harvest does not begin until October so tight
supplies will continue until then.
8/13/10 Cotton futures prices are near contract
highs this week as the extremely hot dry weather in
the delta region may hurt cotton yields
significantly. Strong US exports are also helping
cotton prices along with a few upbeat economic
reports around the globe.
8/6/10 Cotton futures prices rallied towards its
highs as the US Dollar continues to weaken which may
increase demand for US cotton. The current supplies
for cotton are tight and the new harvest is still a
couple of months away.
8/2/10 Cotton futures prices rallied again in spite
of an improving crop rating by the USDA and the fact
that almost 11 million acres where planted this
growing season by farmers in the United States and
weather conditions are practically ideal.
7/24/10 Cotton futures prices rallied this week
almost two cents as the US Dollar continues to
weaken and the Asian economies seem to be growing.
Cotton option premiums are high.
7/10/10 Cotton futures prices sold off this week to
a 4 month low. The USDA supply and demand report
showed US ending stocks up from 2.80 to 3.50 million
bales. World ending stocks came in higher from 49.6
to 49.9 million bales. The exports for 2009-10 are
15% below from a year ago levels.
7/2/10 Cotton futures prices sold off this week
after the USDA planted acreage report came in
bearish for cotton. The estimate of 10.91 million
acreas was up 19% from a year ago which is much more
than most traders expected. The recent sell off in
the US Dollar is not holding cotton prices up.
6/24/10 Cotton futures prices rallied again this
week along with many of the other commodity markets
as the US Dollar has been selling off after making
its high above 89 at the beginning of June. The new
crop supplies are still a few months away from
hitting the market.
6/11/10 Cotton futures prices rallied this week as
hot temperatures in Texas may hurt yields. The
recent USDA report showed US ending stocks come down
from 3.0 to 2.8 million bales and world ending
stocks come down from 50.1 to 49.6 million bales.
The stocks to usage ratio is now 17% which is the
lowest in 15 years.
6/4/10 Cotton futures prices sold off this week for
the 5th day in a row. The expectations of a larger
US crop, the rising US Dollar and concerns about
lower world demand are pressuring prices again.
5/28/10 Cotton futures prices sold off this week as
the lack of any problems and weak demand battle with
tight supplies in the US until harvest. The
strengthening US Dollar is also hurting exports.
5/21/10 Cotton futures prices came down with the
rest of the commodity markets this week as the
European problems stemming from Greece and the other
PIIGS are expected to hurt demand for many
commodities. Investors seem to be choosing cash over
stocks and commodities for now. Tight supplies this
summer are helping firm prices some.
5/14/10 Cotton futures prices are trading sideways
this week. The recent USDA supply and demand report
showed US ending stocks at 3 million bales down from
3.1 million bales. The world ending stocks showed 50
million bales down from 53 million bales.
5/7/10 Cotton futures prices sold off this week as
the Greece problems are decreasing investors' risk
appetite and pushing assets into the US Dollar and
US Treasuries. China is expecting tight supplies for
cotton this year.
4/25/10 Cotton futures prices rallied this week as
news from around the globe has been getting better
including the United States. The recent strength in
the US Dollar does not seem to be affecting the
cotton market for now.
4/16/10 Cotton futures prices traded mostly sideways
this week as the US Dollar started to come down a
bit and the news that the SEC charged Goldman Sachs
with fraud pressured many stock and commodity
markets.
4/9/10 Cotton futures prices sold off this week in
spite of the idea that many economies around the
world are gaining strength and the FOMC minutes
spoke of keeping rates low for a while. Cotton
option premiums are high.
3/27/10 Cotton futures prices sold off this week as
the strong US Dollar and the idea that this months
planting intentions report will show lots more
cotton acres helped push the market down this week.
2/26/10 Cotton futures prices rallied again this
week in spite of the stronger US Dollar and weak
economic reports. The market is factoring in tight
supplies until this fall's harvest and the idea that
wet conditions in the south east of the US will see
continued wet conditions that will delay spring
plantings. Cotton options premiums are high.
2/12/10 Cotton futures prices rallied this week as
the USDA report showed a decrease in US ending
stocks from 4.3 to 3.3 million bales and world
ending stocks increased from 51.7 to 52.1 million
bales. The idea that Europe will help Greece with
its financial problems is lending strength to most
of the commodity markets including cotton.
2/5/10 Cotton futures prices came down again this
week with most of the other commodity markets as the
strength in the US Dollar is expected to diminish
demand and the recent attempts by China to tighten
its monetary system is also hurting prices.
1/30/10 Cotton futures prices came down this week
again as the US Dollar remains strong and the
disruptive harvest weather a few months ago doesn't
seemed to have been too much of a factor for less
yields. Cotton option premiums are high.
1/22/10 Cotton futures prices came down again this
week along with the rest of the commodity markets as
the strong US Dollar and the idea that China is
restraining its economy by raising rates and
increasing the minimum reserve requirements that
banks must keep will diminish demand.
1/15/10 Cotton futures prices came down this week as
the USDA supply and demand report showed US ending
stocks come down from 4.50 million bales to 4.30
million bales. Cotton prices sold off to an 8 week
low based on the news and strength in the US Dollar.
1/8/10 Cotton futures prices sold off this week as
the International Cotton Advisory Committee
predicted that world cotton production would be 24.1
million tons for 2010-11 which is up 8% from this
season's production.
1/1/10 Cotton futures prices rose to the yearly
highs this week as the crop expectation coupled with
demand show a tight supply situation for the coming
year. The recent strength in the US Dollar could not
slow the rally in cotton. Cotton options premiums
are high.
12/11/09 Cotton futures prices rose 5 cents this
week as the USDA supply and demand report showed US
ending stocks decrease from 4.90 to 4.50 million
bales and world ending stocks down from 54 to 52
million tons.
12/4/09 Cotton futures prices were up again this
week in spite of the huge rally in the US Dollar on
Friday following the upbeat jobs report and the
potential for interest rates to be raised.
11/28/09 Cotton futures prices hit their highest
prices in 14 months as the weak US Dollar should
help demand from foreign buyers and the wet weather
in many cotton growing areas is expected to hurt
yields and limit supply. Cotton option premiums are
high.
11/20/09 Cotton futures prices rallied this week as
the harvest is behind the 5 year average and the US
Dollar continues to weaken hitting another contract
low this week. Cotton prices are still considered
undervalued by some analysts as cotton prices are
still 50% below their all time highs.
11/13/09 Cotton futures prices rallied to a 13 month
high based on weakness in the US Dollar and strength
in the commodity markets. The recent USDA report
showed US ending stocks of cotton down from 5.40
million bales to 4.90 million bales and world ending
stocks down from 56 million bales go 54 million
bales.
11/6/09 Cotton futures prices are rallying again and
are near the October highs. The weak US Dollar and
strength in the other softs markets may be helping
prices for cotton.
10/24/09 Cotton futures prices are rallying again as
wet weather in the Mississippi Delta region is
hindering harvest and the recent low levels of the
US Dollar are also helping push prices higher.
10/12/09 Cotton futures prices are rallying this
week along with most other commodity markets as the
US Dollar approached 12 month lows on rumors that
many countries are switching away from the US Dollar
as a reserve currency. The recent USDA report showed
US ending stocks of cotton decrease from 5.6 to 5.4
million bales and world ending stocks stay the same
at 56 million tons.
9/25/09 Cotton futures prices rallied as strong
rains in the South East is causing harvest delays.
The recent rally in the US Dollar is limiting
rallies in the cotton market so far.
9/18/09 Cotton futures prices hit a 5 week high as a
forecast for colder temperatures may hurt yields.
Also helping prices are the weakening US Dollar and
the idea that the global economy may be
strengthening.
9/11/09 Cotton futures prices rallied this week
based on the sell off in the US Dollar. The USDA
estimated for US ending stocks stayed the same at
5.6 million bales and the world ending stocks were
reduced from 57 to 56 million tons. Cotton option
premiums are high.
9/4/09 Cotton futures prices are selling off. The
World Trade Organization ruled that Brazil can
impose $295 million of trade sanctions against the
US because of illegal cotton subsidies by the US
government. Cotton option premiums are high.
8/21/09 Cotton futures prices are selling off this
week as the potential global rebound in growth seems
to have stalled for now. Cotton prices are near 57
cents per pound in spite of the weaker US Dollar.
Cotton option premiums are high.
8/7/09 Cotton futures prices are up this week as the
perception of an improving world economy and the
weakening US Dollar are helping many commodities run
higher. Cotton option premiums are high.
7/31/09 Cotton futures prices rose along with the
rest of the commodity sector as the weakening US
Dollar and favorable economic reports may signal and
end to the recession soon. Recent rains in Texas may
help the crop their. Cotton option premiums are
high.
7/20/09 Cotton futures prices are still trading
sideways in spite of the weakening US Dollar and
more positive economic reports such as retail sales
and industrial production. Cotton option premiums
are high.
7/10/09 Cotton futures prices are trading sideways
as the most recent USDA report showed US ending
stocks unchanged at 5.60 million bales and world
ending stocks up from 57 to 58 million tons. Cotton
option premiums are high.
7/4/09 Cotton futures prices were volatile this week
from up limit to selling off as lower planted
acreage is being offset by the strong US Dollar. The
USDA estimate was 9.05 million acres. Cotton option
premiums are high.
6/21/09 Cotton futures prices sold off to a 6 week
low as wet weather may help some moisture starved
parts of the Texas and the US Dollar continued to
rally. Cotton option premiums are high.
6/5/09 Cotton futures prices rallied as China sold
65,422 bales at a price of 84 cents per pound.
Cotton option premiums are high.
5/30/09 Cotton futures prices have been selling off
recently as lower demand from textile mills and high
short term supplies are pressuring prices. Also
hurting prices was the recent news that China sold
two months worth of domestic demand supplies from
their reserves. Cotton option premiums are high.
5/22/09 Cotton futures prices are selling off as
China recently announced that the government was
making cotton reserves available by the end of the
month hinting towards less imports to China. Cotton
option premiums are high.
5/15/09 Cotton futures prices are still high as the
recent USDA report showed US ending stocks down from
6.8 to 5.6 million bales and world ending stocks
down from 62 to 58 million bales. Cotton option
premiums are high.
5/8/09 Cotton futures prices are still flying
higher. Hot dry weather in Texas may hurt the crop
and the potential for China's economy to turn up are
helping cotton prices run higher. Cotton option
premiums are high.
4/30/09 Cotton futures prices are still heading
higher. The most recent rally took cotton to a 5
month high. Farmers are unlikely to plant cotton
unless prices move appreciably higher. Cotton option
premiums are high.
4/23/09 Cotton futures prices have been on a tear
recently and are currently at the 50 cent level. Dry
weather and one of the smallest crops in decades is
helping push prices higher. Cotton option premiums
are high.
4/10/09 Cotton futures prices are rallying to two
month highs as the USDA prospective plantings report
expects cotton acreage to be the lowest in 25 years.
The USDA estimates US ending stocks down from 7.3 to
6.7 million bales. Cotton option premiums are high.
3/27/09 Cotton futures prices are still running
based on dry soil conditions before planting in
Western Texas. Cotton option premiums are high.
3/20/09 Cotton futures prices rallied this week as
inflation may be coming soon following the worst
deflationary cycle since the Great Depression may be
ending. The recent move by the Fed to print a
trillion dollars and then use then to buy treasuries
has significantly weakened the US Dollar. Cotton
option premiums are high.
3/13/09 Cotton futures prices rallied on the USDA
report news that US ending stocks were down 5% to
7.3 million bales and the world ending stocks went
up to 62.5 million bales. Cotton option premiums are
still high.
3/7/09 Cotton futures prices are selling off this
week based on the strong US Dollar and the sell off
in the stock market. Cotton option premiums are
high.
2/27/09 Cotton futures prices are trading sideways
to down this week in spite of excellent sales
figures and the high probability that farmers will
plant soybeans of corn instead of cotton this year.
Cotton option premiums are high.
2/13/09 Cotton futures prices sold off this week as
the USDA report showed US ending stocks up form 6.90
to 7.70 million bales and world ending stocks up
form 59 to 62 million tons. Also hurting prices is
the estimate that cotton consumption is the lowest
in 10 years. Cotton option premiums are high.
2/6/09 Cotton futures prices are trending higher
since November as cotton acres are expected to
decline and futures prices are below the cost of
production. Cotton option premiums are high.
1/30/09 Cotton futures prices are still climbing and
recently had the highest close in 3 months. This
uptrend is still intact based upon expectations that
the South American drought in many growing areas
will push farmers away from cotton and towards corn
and soybeans. The US farmers will probably also
follow suit and plant soybeans and corn at the
expense of cotton. Chinese cotton production is also
expected to fall. Cotton option premiums are high.
1/16/09 Cotton futures prices rallied based on the
high soybean prices may drive more farmers away from
cotton over to soybeans. US ending stocks were down
from 7.1 to 6.9 million bales. Cotton option
premiums are high.
1/10/09 Cotton futures prices rallied recently on a
short covering rally and the idea that commodity
prices may rebound in 2009 based on the lower US
Dollar and inflation. Cotton option premiums are
high.
12/27/08 Cotton futures prices have been stabilizing
near its contract lows as the cost of production is
higher than the current price of cotton. Cotton
option premiums are high.
12/19/08 Cotton futures prices have been reacting to
moves in the US Dollar this week. Weak dollar days
yielding strength in cotton prices and strong dollar
days yielding weakness in cotton prices.
12/12/08 Cotton futures prices rallied with the rest
of the commodity markets this week as the US Dollar
fell from its highs. The USDA estimates the US
ending stocks up from 6.2 to 7.1 million bales.
Cotton option premiums are high.
12/5/08 Cotton futures prices sold off again to
contract lows this week as China and India have
weakening economies. China and India consume 59% of
the world's cotton. The US is sitting on the
smallest crop in 20 years. Cotton option premiums
are high.
11/30/08 Cotton futures prices are rallying from
contract lows with the falling US Dollar. Cotton
option premiums are high.
11/21/08 Cotton futures prices are still coming down
and are over 10 cents below their loan value. The
fact that cotton prices are cheaper than the cost of
production may soon find a bottom in prices. Cotton
option premiums are high.
11/7/08 Cotton futures prices are still coming down
in spite of the tight supplies. The slowing global
economy is hurting demand and crude oil prices
falling along with the strong US Dollar are not
helping either. Cotton option premiums are high.
11/1/08 Cotton futures prices have fallen below the
cost of production based on the weakening outlook
for the global economy and the strong US Dollar.
Liquidation of commodity index funds and falling
crude oil prices are also pressuring cotton prices.
Cotton option premiums are high.
10/24/08 Cotton future prices are still falling as
mills are unwilling to buy for 50 cents or higher
and because of the massive deleveraging that is
still occurring in the stock and commodity markets.
The large repatriation of US Dollars back to the US
is causing the dollar to rally to 3 year highs which
hurts export demand. Cotton option premiums are
high.
10/10/08 Cotton futures prices were down limit after
the USDA report on Friday. Demand destruction,
perception of a global recession and lower crude oil
prices are pressuring prices. The USDA US ending
stocks showed an increase from 4.90 to 6.20 million
bales and the world ending stocks increased from 52
to 55 million tons. Cotton option premiums are still
high.
10/6/08 Cotton futures prices are selling off and
are below the 55 cent level, a contract low. Fears
of a global recession, the scramble for liquidity
and the strong US Dollar are hurting cotton prices.
Cotton option premiums are high.
9/25/08 Cotton futures prices are trading sideways.
However, at the current demand rate the old crop
supplies will be gone in 8 weeks and a tight new
crop is expected. Cotton option premiums are high.
9/19/08 Cotton futures prices sold off to a contract
low as the rush to liquidity caused by the global
financial meltdown is hurting commodities. Cotton
option premiums are high.
9/12/08 Cotton futures prices sold off most of the
week as the USDA estimated that US ending stocks
were at 4.9 million bales up from 4.6 million bales
last month. World ending stocks were at 52 million
bales up from 51 million bales last month. Cotton
has been following crude oil down recently. Cotton
option premiums are high.
9/5/08 Cotton futures prices sold off in spite of
the huge amounts of rain created by Hurricane Gustav
hitting the already soaked cotton fields. The large
lack of demand is shown by the lack of exports.
Cotton option premiums are high.
8/29/08 Cotton futures prices rallied this week
based on the threat of Hurricane Gustav bringing
more rain to the Mississippi and Louisiana crops
that already have too much moisture. Boll rot is
already taking a toll on yields and more rain will
only make it worse. Cotton option premiums are high.
8/22/08 Cotton futures prices rallied this week 3
cents based on the sell off in the US Dollar and the
run up in crude oil prices. The rally may not hold
because exports are down by 35% from a year ago and
beneficial rains are helping the cotton crop. The
recent rally was more about a lack of selling versus
an increase in buying. Cotton option premiums are
high.
8/15/08 Cotton futures prices sold off this week in
spite of the USDA estimates for the US ending stocks
decreasing from 5.30 to 4.60 million bales and the
world ending stocks decreasing from 53 to 51 million
tons. Cotton option premiums are high.
8/8/08 Cotton futures prices have been in a 10 cent
consolidation for a few months now because bearish
news is usually being offset by hot dry weather in
the cotton areas of west Texas. Cotton option
premiums are high.
7/25/08 Cotton futures prices rallied this week as
potential flood damage caused by hurricane Dolly may
impact the Texas cotton crop yields. Cotton option
premiums are high.
7/18/08 Cotton futures prices fell this week in the
wake of the broad based commodity sell off led by
crude oil. Cotton is holding the 70 cent level and
may have bottomed. Cotton option premiums are high.
7/11/08 Cotton futures prices rallied this week
based on the USDA estimates for US ending stocks
declining from 5.40 to 5.30 million bales and the
world ending stocks were decreased from 54 to 53
million bales. Cotton option premiums are high.
7/4/08 Cotton futures prices have been falling this
week based on the yield damage estimates for west
Texas cotton not being as bad as expected. The rally
in the US Dollar late in the week also hurt cotton
prices. Cotton option premiums are high.
6/27/08 Cotton futures prices rallied this week as
only 30% of the Texas crop is rated good to
excellent. Recent rains probably wont help cotton
yields very much. Cotton option premiums are high.
6/20/08 Cotton futures prices
rallied this week as hot dry weather is hurting the
west Texas cotton crop and the USDA reported that
cotton conditions are deteriorating. Weather
forecasts are calling for potential rain over the
weekend in some of the drier areas. Cotton option
premiums are high.
6/13/08 Cotton futures prices
rallied this week along with the other commodities
and because the USDA supply and demand report showed
a decrease in cotton ending stocks from 5.6 to
5.4 million bales. Hot dry weather in Texas is also
helping cotton futures prices stay up. Cotton option
premiums are high.
6/6/08 Cotton future prices
rallied this week because of the fall in the US
Dollar based on talk that the EU will raise interest
rates to fight inflation. Cotton is very dependent
upon exports and a strong dollar typically hurts
prices. Cotton option premiums are high.
5/30/08 Cotton futures prices
are falling again to an 8 month low as the US Dollar
continues to strengthen which should damage export
demand for cotton. Cotton option premiums are high.
5/23/08 Cotton futures prices
are still trading sideways in a tight 3 cent range
for the last few weeks. The USDA reports that 49% of
the cotton is planted. This is down from the five
year average of 59%. The US Commerce Department said
that cotton mill use increased in April from the
rate of 4.2 to 4.7 million bales. Cotton option
premiums are coming down.
5/15/08 Cotton futures prices
are range bound this week. Their has been now real
news to move cotton futures prices and the US Dollar
has begun to weaken a bit. Cotton option premiums
are high.
5/9/08 Cotton futures prices
have been trading mostly sideways this week. The
USDA supply and demand report US ending stocks
estimates came in at 5.60 million bales down from
9.90 million bales in 2007-08. Global ending stocks
are 56 million bales down from 62 million in
2007-08. Cotton option premiums are high.
5/1/08 Cotton futures prices are
still falling based on the strength in the US
Dollar. Higher dollar values hurt cotton exports to
other countries. Cotton acreage is still at decade
lows and any weather events could spur a rally.
Cotton option premiums are high.
4/25/08 Cotton futures prices
dropped this week in sympathy to the overall
commodity market and especially the grains. The
strong US Dollar hurts exports because of higher
prices for foreign buyers. The sell off in crude oil
from the highs also hurts cotton because when crude
oil prices are high textile mills use natural fibers
like cotton instead of manmade petroleum product
fibers like polyester and rayon. Cotton option
premiums are high.
4/18/08 Cotton futures prices
rallied through 80 cents this week only to be hit by
massive profit taking from commodity funds. The USDA
is predicting a 13% drop in planted cotton acres
this year because of favorable pricing in corn,
beans and wheat for farmers. Cotton option premiums
are high.
4/11/08 Cotton futures prices
rallied this week as Walmart bought 12 million
pounds of cotton for earth month t-shirts. Cotton
also lost acres to corn and soybeans and had a huge
week in export sales of 484,000 bales. Cotton option
premiums are still high.
4/4/08 Cotton futures prices are
trading sideways this week even as the USDA
predicted the cotton acres to be down 13% from a
year ago. Cotton futures prices had been on a tear
recently but seemed to have gotten ahead of itself.
The dry weather in cotton growing portions of the
south and TX may boost prices but for now the
cotton market is content with sideways price action.
Cotton option premiums are high.
3/28/08 Cotton futures prices
were consolidating this week and traders were
positioning for the March 31 Prospective plantings
report by the USDA. Expectations are that cotton
acres will shrink because farmers can make more per
acre with soybeans, corn and wheat. Cotton option
premiums are high.
3/21/08 Cotton futures prices
kept falling this week as Wall Street hedge funds
and commodity funds liquidated futures positions to
cover margin calls in stocks and to pay back
borrowed money. The Bear Stearns issue took the
confidence from investors. The Fed's 75 basis point
cut surprised investors because a full 100 basis
point cut was expected. Cotton option premiums are
high.
3/14/08 Cotton futures prices
went limit up for a couple of days and then limit
down. Now prices are consolidating sideways. In 14
years of trading, I have never seen such volatility.
Cotton futures have more price increases to achieve
if farmers are to plant it instead of corn, beans
and wheat. The new low for the US Dollar may help
prices go higher especially if the Federal Reserve
Bank cuts rates again. Cotton option premiums are
ridiculous and some sideways price movement will be
needed to deflate cotton option premiums.
3/7/08 Cotton futures prices
went up limit for 4 days in a row only to sell off
limit the last 2 days. The short futures price
squeeze produced ridiculous option premiums as short
futures holders flooded to the options markets to
offset losses. Cotton option premiums are outrageous
currently.
2/29/08 Cotton futures prices
rallied to contact highs this week based on the
battle for acreage with beans, corn and wheat. The
National Cotton Council predicts that cotton mill
use fell from 4.74 to 4.68 million bushels in
January. Cotton futures prices have the challenge of
rising enough to compete for acreage with other more
profitable agricultural products. The potential 50
basis point rate cut expected by the Fed in March is
also helping prices rise on inflationary fears.
Cotton option premiums are high.
2/22/08 Cotton futures prices
rallied this week the highest close in a month
because cotton looks cheap to speculators compared
to the grains. The USDA planting estimate came out
this week and shows cotton acreage down 12% to 9.5
million acres this year. If this estimate is
correct, that would be the lowest plantings in 25
years. All time highs for crude
oil futures prices also supported the cotton futures
market. Cotton option premiums are getting high.
2/15/08 Cotton futures prices
were up limit on Thursday of this week based on
expectations of very limited acreage being planted
this year. The USDA projected cotton production for
2008-9 is expected to be down 9%. The soybean to
cotton ratio of 10 to 1 is one way that farmers
decide what crop to plant. It is usually 3 to 1 for
corn to soybeans. The 10 to 1 ratio would
necessitate cotton futures prices going up over a
dollar. The soft commodities have definitely
outperformed most other commodities this year and still seem
undervalued vs. the rest of the commodity market.
Cotton option premiums are above average.
2/8/08 Cotton futures prices
rallied in sympathy with the grains and because the
USDA says that exports are better than expected.
Cotton futures prices have been consolidating around
70 cents for the last few weeks. High crude oil
prices helps cotton demand because synthetic fibers
such as polyester, nylon and rayon are petroleum
based and are expensive compared to cotton. Cotton option
premiums are above average.
2/1/08 Cotton futures prices are
trading sideways this week waiting for next Friday's
USDA report. Currently the US cotton planted acreage
estimates are near an 18 year low as farmers are
paid more to plant corn, beans and wheat at the
expense of cotton. Cotton futures prices rallied to
$1.17 the last time that global supplies where this
low. Cotton option premium is above average.
-T & K Futures and Options Inc. |
