DTN Closing Cotton            02/27 13:32

   Cotton Eyes Approaching Spring

   The cotton market ended the month of February on a positive, albeit a small 
note. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market ended the month of February on a positive, albeit a small 
note. For all of its ups and downs, the ICE futures closed out some 77 points 
higher on the month. However, the month of March should unfold different and 
influential news. One immediate concern is that the U.S. cotton planted area 
has now swelled to 84% dry-to-drought conditions.

   Today at 3:30 p.m. EST, the CFTC will issue its weekly Commitment of Traders 
report. At last count, the managed-money funds had net sold some 3,900 
contracts, swelling their current bearish position to 79,508 contracts. For 
context, their record high negative carry from last October, stands at 81,343 
contracts.

   U.S. cotton sales have been consistently above 200,000 bales for six 
straight weeks and above 300,000 in four of the last six, which is much better 
than where they were up until then. However, cumulative sales are still at 
their lowest level in 11 years, and they have only reached 75% of the USDA 
forecast versus a five-year average of 88% for this point in the season as of 
last week.

   The U.S. dollar eased today despite the hotter-than-expected PPI (producer 
price index) for January, and on the rising tensions between the U.S. and Iran. 
The Producer Price Index rose 0.5% last month after advancing 0.4% in December.

   For Friday, July closed at 67.32 cents, up 25 points; December 2026 closed 
at 69.70 cents, plus 25 points; and March 2027 finished at 70.64 cents, 29 
points lower. Friday's estimated volume was 43,971 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com




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