DTN Morning Cotton Commentary          01/07 07:29

   Cotton Sustains Higher Move

   The cotton market continues to stabilize and sustain better price levels.

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market continues to stabilize and sustain better price levels. 
There have been a fair amount of producers selling to merchants when the spot 
price and the government price option payment (POP) collaborate together. 

   As mentioned, Monday's export sales report now has USDA caught up in its 
shutdown-delayed information. The next export sales report will be this 
Thursday at 8:30 a.m. EST. Sales are still running the lowest in 11 years, and 
have only reached 58% of USDA forecast's versus a five-year average of 75% for 
this point in the marketing year. This drag suggests the agency could lower its 
forecast in the upcoming WASDE.

   With that, this Monday USDA will issue its monthly supply-demand update. As 
implied U.S. exports could be reduced, but also the 2025 crop might see a small 
retraction. The report will be at noon EST.  Estimates will come later in the 
week.

   The U.S. Supreme Court will rule this Friday regarding the legality of the 
Trump administration's sweeping global tariffs. The challenge to Trump's 
tariffs is among the most closely watched of the cases awaiting decisions by 
the top U.S. judicial body that could impact the global economy and marks a 
major test of presidential powers

   The 6- to 10-day weather forecast calls for normal temperatures for the 
Southeast, the Delta, and central Texas. The Texas Panhandle looks to 
experience above-normal temps. Rainwise, the entire U.S. Cotton Belt will be 
saddled with below- to much-below normal precipitation.

   Daily chart support for March cotton stands at 64.80 cents and 64.00 cents, 
with resistance hovering about 66.00 cents and 66.45 cents. Wednesday morning's 
estimated opening volume is 14,250 contracts.

    

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780.




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