Tuesday, July 9, 2013

DTN Morning Comments on Cotton

Cotton Contracts Higher Early Tuesday

Taking its cue from a bullish weekly crop condition report and spillover support from grains, the cotton market showed gains early Tuesday.
By Darin Newsom DTN Senior Analyst
OUTSIDE MARKETS: Cotton contracts on China’s Zhengzhou Exchange were lower. Dow Jones Industrial Average futures were 30 points higher indicating continued buying was likely on the open of US equities trade Tuesday. Crude oil is down $0.39 at $102.75 while gold is up $14.30 at $1,249.20. The U.S. dollar index is 0.165 higher at 84.358. Grain futures are higher early Tuesday morning.
General Comments: The weekly crop condition report released late Monday afternoon resulted in a DTN Cotton Crop Condition Index of 97 points, well off the previous week’s rating of 118 points and last year’s 112 points. Weather remains the key issue in the lower ratings, with forecasts calling for little change. As for crop progress, also released in Monday’s weekly reports, the crop was seen at 51% squaring as compared to the five-year average of 63%, and setting bolls was pegged at 10% as compared to the average of 18%. All of these numbers should be considered bullish for new-crop cotton.
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