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USDA - AMS: Weekly Cotton Market Review, narrative (2019-02-01)

USDA U.S. Department of Agriculture - February 1, 2019

Mp_cn812 
February 1, 2019 
Weekly Cotton Market Review 
 


Spot quotations averaged 64 points higher than the previous week, 
according to the USDA, Agricultural Marketing Service’s Cotton and 
Tobacco Program. Quotations for the base quality of cotton (color 41, 
leaf 4, staple 34, mike 35-36 and 43-49, strength 27.0-28.9, and 
uniformity 81.0-81.9) in the seven designated markets averaged 69.81 
cents per pound for the week ending Thursday, January 31, 2019. 
The weekly average was up from 69.17 last week, but down from 75.71 
cents reported the corresponding period a year ago. Daily average 
quotations ranged from a low of 69.60 cents Monday, January 28 to a 
high of 69.93 cents Wednesday, January 30. Spot transactions reported 
in the Daily Spot Cotton Quotations for the week ended January 31 totaled 
91,509 bales. This compares to 44,962 reported last week and 40,895 spot 
transactions reported the corresponding week a year ago. Total spot 
transactions for the season were 462,593 bales compared to 1,301,150 bales 
the corresponding week a year ago. The ICE March settlement prices ended 
the week at 74.40 cents, compared to 73.14 cents last week. 


Southeastern Markets Regional Summary


Spot cotton trading was slow.  Supplies and producer offerings were 
moderate.  Demand was moderate.  Average local spot prices were higher. 
Trading of CCC-loan equities was inactive. 
     
Winter weather alerts were issued across much of central and north Alabama 
and north Georgia early in the period as an arctic front made its way across 
the region.  A band of storms brought from trace amounts to around one-quarter 
of an inch of precipitation to areas of north Alabama and Georgia early week.  
Daytime high temperatures were in the upper 40s to mid-50s, while nighttime 
lows plunged into the 30s to low 20s.  Fieldwork resumed in areas where soils 
were firm enough to support equipment.  Producers mowed stalks and made progress 
harvesting remaining fields.  Ginning continued at locations where backlogs 
of modules accumulated on gin yards.  Cotton quality continued to be negatively 
impacted where fiber has been left in the fields for months.  The Macon Classing 
Office was down to one daily shift to accommodate the flow of samples arriving.  
Producers, ginners, and industry members attended the Georgia Cotton Commission’s 
12th Annual meeting in Tifton, GA on January 30. 
 
Similar weather was observed across the upper Southeast as an arctic cold front 
associated with the polar vortex moved across the region early in the week.  
Mostly clear to partly cloudy conditions were observed throughout the period.  
Daytime high temperatures were in the low 50s to low 40s and overnight lows dipped 
into the low 40s to low 20s.  Scattered shower activity brought from trace amounts 
to around one-quarter of an inch of precipitation to portions of the eastern Carolinas, 
with heavier accumulations observed along coastal areas.  Producers attempted to mow 
stalks and complete fieldwork in areas were soils were firm enough to support equipment. 
Ginning neared completion; some gins remained on gins days as they waited for the 
backlogs of modules to accumulate on gin yards.  The Florence Classing Office had 
a single shift operating as needed. 
 
Textile Mill 

Domestic mill buyers purchased a moderate volume of color 41, leaf 4, and staple 35 
and longer for June through October delivery.  Mill buyers also purchased a moderate 
volume of 2019-crop cotton, color 41, leaf 4, and staple 34 and longer for November/December 
delivery.  No other sales were reported; most mills have covered their immediate-to-nearby 
raw cotton needs.     
     
Demand through export channels was moderate.  Agents throughout the Far East inquired for 
any discounted styles of cotton; demand was best for mixed lots containing lower grades.      

Trading 
..
Mixed lots containing color 42 and better, leaf mostly 3 and 4, staple 35-37, mike 43-49, 
strength 29-32,  uniformity 80-82, and containing approximately 25 percent extraneous matter 
sold for around 70.00 cents per pound, FOB car/truck (Rule 5, compression charges paid). 
..
A light volume of color mostly 42 and 52, leaf 3-5, staple 37 and 38, mike 40-45, strength 28-30,  
uniformity 79-81, and containing approximately 25 percent extraneous matter sold for around 
65.50 cents, same terms as above. 


South  Central Markets Regional Summary 
  

North Delta
 
Spot cotton trading was inactive.  Supplies of available cotton were moderate.  Demand was light.  
Average local spot prices were higher.  Trading of CCC-loan equities was inactive. No forward 
contracting was reported; no new sales were reported.     
     
A polar vortex brought freezing temperatures and extreme wind chills to the region during the period.  
Daytime high temperatures were in the 30s, with a wind chill factor in the low teens.  Overnight 
lows were in the 20s.  Temperatures moderated by the end of the week.  The Memphis Classing Office 
maintained one shift as cotton continued to trickle in from a few gins.  The Dumas Classing Office 
was classing as necessary as a few gins wrapped up pressing operations for the season. Producers 
and other interested persons made plans to attend   industry-related workshops and meetings, 
including the Mid-South Farm and Gin Show, scheduled for March 1-2 in Memphis, TN. Producers were 
working with crop adjusters to determine the extent of damage from heavy rains during the harvest, 
as well as planning for their next crop. 

South Delta 

Spot cotton trading was inactive.  Supplies of available cotton were moderate.  Demand was light.  
Average local spot prices were higher.  Trading of CCC-loan equities was inactive. No forward 
contracting was reported; no new sales were reported.   
     
A polar vortex brought freezing temperatures to the region during the period.  Daytime high temperatures 
were in the 20s to 50s during the period.  Overnight lows were in the 20s to 40s.  Bright, sunny 
days helped move temperatures back into the 60s by the end of the week.  The Rayville Classing 
Office had ceased operations for the year.  Producers and other interested persons made plans to 
attend   industry-related workshops and meetings, including the Mid-South Farm and Gin Show, 
scheduled for March 1-2 in Memphis, TN.  Producers were also working with crop adjusters to 
determine the extent of damage from heavy rains during the harvest, as well as planning for their next crop. 

Trading 
  
North Delta 
..
No trading activity was reported. 
 
South Delta 
..
No trading activity was reported. 


Southwestern Markets Regional Summary      .


East Texas 

Spot cotton trading was active.  Supplies and producer offerings were moderate.  Demand was moderate.    
Average local spot prices were higher.  Producer interest in forward contracting was light.  Trading 
of CCC-loan equities was slow.     
     
Producers in the Rio Grande Valley were encouraged with the planting season nearing. Pre-plant meetings, 
cotton conferences, and applicator trainings were held by Texas Agrilife Research and Extension service.  
Dry conditions persisted and irrigation was underway.  A planting rain event is needed to help ensure 
germination.  Daytime temperature highs in Harlingen were in the mid-60s to mid-70s, and overnight lows 
were in the low 40s to mid-50s.  The final planting date for full insurance coverage in Cameron, Hidalgo, 
Jim Hogg, Starr, Willacy, and Zapata Counties is March 31.   Fertilizer was applied, soil was turned, 
and rows were built in south Texas.  Ginning continued in the Winter Garden area.  Some fieldwork was 
completed in the Northern Blackland Prairies as soils continued to dry and firm.  Kansas producers 
were able to return to some fields on a limited basis and restart harvesting, but many fields remained 
too muddy to support equipment. Excitement for planting cotton is expected to continue into the next 
crop year for Kansas and Oklahoma   producers.  Ginning continued in Oklahoma.        
 
West Texas 

Spot cotton trading was active.  Supplies and producer offerings were heavy.  Demand was good.  
Average local spot prices were higher.  Producer interest in   forward contracting was light.  
Trading of CCC-loan equities was moderate.   
     
Daytime highs were in the low 40s to upper 50s and overnight lows were in the teens to lower 30s 
in Lubbock, and even cooler in the panhandle.  Windy conditions persisted under mostly sunny, and             
occasional partly cloudy skies.  Ginning continued, but the majority of gins in the Lubbock and 
Lamesa Classing Office territories had finalized pressing operations.  The Abilene Classing Office 
continued operating two shifts to keep pace with incoming samples.
        
Trading 
 
East Texas 
..
In Texas, a mixed lot containing a moderate volume of mostly color 31 and 41, leaf 2 and 3, staple 37, 
mike 41-46, strength 28-32, and uniformity 77-81 sold for around 69.50 cents per pound, 
FOB warehouse (compression charges not paid). 
..
In Oklahoma, a moderate volume of mostly color 41, leaf 3, staple 36 and 37, mike 38-43, strength 29-32, 
and uniformity 80-82 sold for around 70.00 cents, FOB car/truck (compression charges not paid). 
..
In Kansas, a light volume of mostly color 21, leaf 2 and 3, staple 36, mike averaging 42.1, strength         
averaging 29.1, and uniformity averaging 81.1 sold for around 73.00 cents, same terms as above.  
..
A light volume of CCC-loan equities traded for around 7.00 cents. 

West Texas 
..
A heavy volume of mostly color 31, leaf 3 and better, staple 39 and 40, mike 36-45, strength 30-33, 
and uniformity 79-83 sold for around 73.25 cents per pound, FOB car/truck (compression charges not paid).   
..
A moderate volume of color 31 and 41, leaf 4 and better, staple 37, mike 39-52, strength 30-33, and        
uniformity 80-82 sold for around 70.00 cents, same terms as above.   
..
A moderate volume of color 31 and 41, leaf mostly 3 and 4, staple 37, mike 33-41, strength 28-32,         
uniformity 77-81, and 25 percent extraneous matter sold for around 67.00 cents, same terms as above.   
..
A moderate volume of CCC-loan equities traded for 10.00 to 13.25 cents. 

 
Western Markets Regional Summary 
 

Desert Southwest (DSW) 

Spot cotton trading was moderate.  Supplies and demand were moderate.   Producers continued 
to deliver previously contracted cotton to merchant and cooperative marketing pools.  
Average local spot prices were higher.  No forward contracting or domestic mill activity 
was reported.  Foreign mill inquiries were light.    
     
Daytime high temperatures were mostly in the low to mid-70s for central Arizona.  Some gins 
neared completion on first pick harvest and were set to begin ginning rood cotton.   
Local sources reported some growers experienced yield loss as much as half-bale, due to 
continued wet weather during the harvest season.  Seed quality declined, which disqualified 
some seed for the save-seed programs.  The decline in quality was also attributed to excessive 
moisture.    Daytime high temperatures were in the 60s for New Mexico and El Paso, TX.  
Nighttime lows were in the low 30s.  Ginning was completed in New Mexico, but continued in El Paso, TX.  
       
San Joaquin Valley (SJV) 

Spot cotton trading was inactive.  Supplies and demand were light.  Producers delivered 
previously contracted cotton to merchant and cooperative marketing pools.  Average local 
spot prices were higher.  No forward contracting or domestic mill activity was reported.  
Foreign mill inquiries were light.    
     
Foggy conditions prevailed early in the week.  Daytime temperatures were in the 60s.    
Rainfall was received late in the reporting period.  Precipitation amounts were around 
one-tenth to three-quarters of an inch.  High wind watches were in effect as the storms 
rolled through.  The second manual snow survey of the Sierra Nevada Mountains snowpack was 
conducted on January 30 by the California Department of Water Resources.  The snowpack’s 
statewide water content was reported at 100 percent of average for this time of year.  
Some roller gins were completed for the season; for others ginning continued.   
 
American Pima (AP)
 
Spot cotton trading was inactive.  Supplies were moderate.  Demand was light.    
Average local spot prices were steady.  No forward contracting was reported.     
Foreign mill inquiries were light.      
     
Daytime high temperatures were in the 60 to 70s in the Far West.  No rain was recorded 
for Arizona, New Mexico, and El Paso, TX.  The San Joaquin Valley of California received 
one-tenth to three-quarters of an inch of moisture late in the reporting period.  
The second manual snow survey of the Sierra Nevada Mountains snowpack was conducted on 
January 30 by the California Department of Water Resources.  The snowpack’s statewide water 
content was reported at 100 percent of average for this time of year.  Ginning continued.   

Trading 
 
Desert Southwest 
..
In Arizona,  a light  volume of mostly color 31 and 41, leaf 4, staple 36 and longer 
sold for around 650 points off ICE March futures, uncompressed, FOB warehouse.  

San Joaquin Valley 
..
No trading activity was reported. 
 
American Pima 
..
A light volume of color 2, leaf 2, staple 46 and longer, with a minimum strength 
gpt of 36 was sold to domestic mills.   





 




 


 












 


 


USDA ANNOUNCES SPECIAL IMPORT QUOTA #15 
FOR UPLAND COTTON 
January 31, 2019 


The Department of Agriculture's Commodity Credit Corporation announced a special import quota for upland cotton that permits importation of a quantity of upland cotton equal to one week’s domestic mill use. The quota will be established on February 7, 2019, allowing importation of 12,334,220 kilograms (56,650 bales) of upland cotton.  
     Quota number 15 will be established as of February 7, 2019, and will apply to upland cotton purchased not later than May 7, 2019, and entered into the U.S. not later than August 5, 2019. The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period July 2018 through September 2018, the most recent three months for which data are available.  
     Future quotas, in addition to the quantity announced, will be established if price conditions warrant.  


Due to the recent lapse in federal funding, the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) has not published a weekly export sales report since December 20, 2018. FAS has resumed daily reporting of export sales and will implement a backdated release schedule to bring weekly reporting up to date. The regular reporting schedule will resume for t he week ending February 22, 2019.  





 


Delivery Points 
  
Stocks as of  
1-31-2019 
  
Awaiting Review 
  
   
Non-Rain 
Grown Cotton 
 
Dallas/FT. Worth, TX 
 8,483 
 0 
 0 
 
Galveston, TX 
 26,248 
 0 
 0 
 
Greenville, SC 
 37 
 0 
 0 
 
Houston, TX 
 10,515 
 0 
 0 
 
Memphis, TN 
 71,925 
 0 
 0 
 
Total 
 117,208 
 0 
 0 
 

Number of Bales in Certificated Stocks 







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