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DTN Closing Cotton            10/14 13:42

   Cotton Sharply Lower on China Reversal

   The cotton market retraced all of its Friday gains, as well as its Sunday 
night surge, to close over a cent lower Monday. 

By Keith Brown
DTN Cotton Correspondent

   The cotton market retraced all of its Friday gains, as well as its Sunday 
night surge, to close over a cent lower Monday. The cause for such two-sided 
volatility revolved around China's initial acceptance of a partial trade deal 
on Friday and its change-of-heart attitude over the weekend. Now, Chinese 
negotiators have said they want to return to the U.S. and have another series 
of face-to-face meetings in late October. Additionally, China wants all 
potential new tariffs delayed. Clearly, China's willing to brazenly renege, yet 
again, cast a bearish pall over many markets Monday, especially cotton.  

   Tuesday afternoon, USDA will report on the harvest progress of the 2019 
crop. Last week, the data showed farmers have harvested some 25% of the crop. 
Of course, USDA also reported the current crop stands at 21.85 million bales, 
after having reduced domestic production some 150,000 bales on its last monthly 
supply-demand report. 

   Later this week USDA will report on weekly sales and exports. It is hoped 
hope among some "cotton camps", the very least China might do towards offering 
a positive twist to the partial trade deal would be to no longer cancel any 
previous 2019-20 purchases. Of course, evidence of such cancellations or not, 
will be displayed in that weekly report. 

   For Monday, December cotton closed at 62.22 cents, down 1.66 cents, March 
finished at 63.18 cents, down 1.27 cents and December 2020 ended at 65.28 
cents, down 0.13 cents. Monday's estimated volume was 54,110 contracts. 

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780. 


(BE)

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