COTCO wants to send market news and weekly USDA and February 2023WASDE reports as follows:
- ICE May closed at 85.94, down 6 points.
- ICE July closed at 86.45, down 19 points.
- Total open interest (OI) in May increased by 5,693 to 52,500 contracts, while total open interest increased by 2.53% to 210,431 contracts.
USDA Weekly Report for Sales – Exports: For the week ending February 2, USDA reported fairly good US cotton export sales of 267,600 bales for UPLAND and 1300 bales for PIMA. China topped the number of strong purchases for crop year 22/23 at 87,700 bales, and Turkey at 72,600 bales. Total export shipments were also significantly higher at 215,900 thousand bales.
February WASDE Supply – Demand Report: the data is said to be relatively calm. World ending inventories decreased, exports and imports decreased respectively,
Global production in MY 2022/23 is estimated to be about 1 million bales lower than January, while consumption is expected to be only 200,000 bales lower at around 110,663 million bales. For West Africa, Pakistan, and India, production is expected to be lower.
In economic news, three US senators wrote to the chief executive officer of Shein, China’s largest private online retailer, asking Shein to provide details on the process and how to ensure that there is no cotton for the items they ship to the United States that originate from Xinjiang. Federal law states that goods from this area are products of forced labor. On the Shein side said it has hired third-party agencies to conduct regular audits, Shein also asked suppliers to buy cotton from Australia, Brazil, India, the US, and other approved regions and implemented a traceability management system that shows the origin of cotton throughout the entire production process.
- Short-term expectations: The market is looking forward to the report on world economic data, The US jobs report and inflation in China, and the rebalancing of funds only from 10-13 February. In general, cotton traders and growers are expecting the price to find new support.
Cotton futures forecast for May:
- The chart low is at 78.80-80.37, and the market high is at 89.65 – 89.92;
- In the short term, resistance is near 87.50 – 88.00, and support is near 82.00 – 82.50.
The updated USDA figures report is as follows:
Thank you for your interest in the information.