Cotton Market Lower Again On China Trade Risk
BRUG - Mon May 13, 7:26AM CDT

Cotton futures are down 106 to 161 points this morning. They posted triple digit losses in the front months on Friday, as July was down 9.55% in a single week. Cotton is at risk should the Chinese decide to raise tariffs in response to the last US hike, as they are still buying US cotton. The WASDE 2018/19 US balance sheet saw a 250,000 bale increase to stocks at 4.65 million bales, thanks to a reduction to expected exports. The first 19/20 balance sheet of the year showed a 1.85 million bale jump in new crop carryout to 6.4 million bales, with production seen at 22 million bales and exports of 17 million bales. World cotton stocks for old crop saw a marginal 0.03 increase to 76.47 million bales. New crop is seen at 75.69 million bales, with Chinese imports expected to increase 2.5 million bales to 11 million. The weekly Average World Price (AWP) is now 64.65 cents/lb, down 3.62 cents from last week. Spec in cotton futures and options flipped their net position back to short by 15,088 contracts in the week of May 7 to -4,841 contracts.

--provided by Brugler Marketing & Management

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