DTN Closing Cotton            08/04 13:42

   Counter-Tuesday Keeps the Lid on Cotton

   The cotton market traded triple-digits lower Tuesday, then made a valiant 
late-day effort to finish positive.

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market traded triple-digits lower Tuesday, then made a valiant 
late-day effort to finish positive. However, the counter-Tuesday phenomenon 
kept the lid on the market. The ICE futures were bearishly influenced by 
surrounding outside markets. The energies, grains and meats were all decidedly 
negative Tuesday.

   Highlights from USDA's condition report included good-to-excellent ratings 
that were off 4% to 42% with the poor to very poor at 20%, up 4%. The current 
standing reveals that good to excellent is 6% below its 10-year average. Among 
the 15 states reporting, six improved, seven declined and two held steady.

   In other weather news, Chinese production continues to be stressed with high 
heat and dryness. In fact, those conditions are set to expand. The weather 
outlook for Texas and the Gulf Coast calls for an extension of hot temperatures 
next week.

   China's State Reserve completed its 11th consecutive sold out auction 
Tuesday, selling approximately 8,015 tonnes (about 35,266 bales). The 11-day 
total reached 88,209 tonnes (about 388,120 bales), consisting of roughly 54% 
U.S. cotton, 17% Brazilian and 29% Xinjiang.

   This Thursday, USDA will issue fresh export sales data. Last week saw net 
sales for the 2026/2027 season of 352,400 bales. The top buyers included 
Vietnam (245,500), India (42,200) and Pakistan (18,400). Shipments tallied 
233,800 bales, which was down 15% weekly. The primary destinations were Vietnam 
(78,600), Pakistan (49,400), Indonesia (18,000), Turkey (12,700) and Mexico 
(12,400). The data will be out at 8:30 a.m. EDT.

   Crude oil prices were materially lower Tuesday after Treasury Secretary 
Bessent alluded to a Hormuz deal this week on a business channel. The WTI 
futures rapidly fell toward the $75 per barrel mark.

   For Tuesday, December closed at 82.45 cents, minus 12 points; March 2027 
finished at 84.05 cents, down 8 points, but July 2027 settled at 84.86 cents, 
up 16 points. Tuesday's estimated volume was 53,545 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com




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