Mp_cn812 October 13, 2017 Weekly Cotton Market Review Average quotations were 35 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, uniformity 81.0-81.9) in the seven designated markets averaged 67.04 cents per pound for the week ending Thursday, October 12, 2017. The weekly average was up from 66.69 last week, and 66.87 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of 67.43 cents Monday, October 9 to a low of 66.14 cents Thursday, October 12. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended October 12 totaled 6,513 bales. This compares to 7,209 bales reported last week and 4,907 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 50,440 bales compared to 44,201 bales the corresponding week a year ago. The ICE December settlement prices ended the week at 67.84 cents, compared to 68.27 cents last week. Southeastern Markets Regional Summary Spot cotton trading was slow. Supplies were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Wet and warm conditions dominated the weather pattern across South Carolina and much of the lower Southeast during the period. Daytime high temperatures were in the 80s. Hurricane Nate brought around one-half of an inch up to six inches of moisture to areas throughout the Gulf, Alabama, portions of south Georgia, and the Atlantic coastal region. The moisture brought harvest activities to a standstill in the affected areas. Very few fields in south Alabama were at their most vulnerable stage and only light yield losses were expected. Saturated soils made the transfer of modules from fields to gin yards difficult; most gins had sufficient backlogs of modules to continue pressing operations uninterruptedly. Mostly cloudy conditions were observed across North Carolina and Virginia during the period, with daytime high temperatures in the low 80s. Overnight lows dipped into the 50s late-week. Intermittent shower activity brought less than one-half of an inch of accumulated moisture to these areas during the period, with more rain in the forecast. Cotton harvest was underway across the entire Southeast region and reached 22 percent in Alabama, 19 in Georgia, 13 in North Carolina, 19 in South Carolina, and 5 percent in Virginia, according to the National Agricultural Statistics Service’s Crop Progress report released October 10. Textile Mill Domestic mill buyers inquired for a light volume of color 41, leaf 4 and better, and staple 34 and longer for January through March delivery 2018. No sales were reported. Most mills have covered their immediate to nearby raw cotton needs. The undertone from mill buyers was cautious. Demand through export channels was light. Mill buyers in the Far East purchased a light volume of color 31, leaf 3, and staple 36 cotton for January through March 2018 shipment. No additional sales were reported. Trading .. A moderate volume of color 31 and better, leaf 4 and better, staple 34 and longer, mike 35-49, strength 28-33, and uniformity 78-83 traded at around 225 points on ICE December futures, FOB car/truck (Rule 5, compression charges paid). South Central Markets Regional Summary North Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was moderate. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Hot, dry weather early in the week gave way to high humidity and thunderstorms as the remnants of Hurricane Nate moved through the Memphis territory. Approximately 1 inch of rain fell generally throughout the region. Daytime temperatures were in the low 90s. Overnight lows were in the 70s early in the period, but a cold front brought lows in the 50s late week. The crop made good progress. Defoliation and harvesting were delayed, due to inclement weather events. Most gins in the Memphis territory completed pre-season preparations; several had accumulated sufficient modules on their yards to commence annual pressing operations. Producers were carefully watching the extended forecast for temperatures in order to properly time the application of defoliants, which lose their effectiveness in cool weather. Some producers reported average yields of 1,100 pounds per acre, somewhat less than anticipated. According to the National Agricultural Statistics Service’s Crop Progress report released October 10, harvesting in Arkansas was 29 percent completed, 24 in Missouri, and 24 percent in Tennessee. South Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was moderate. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Sunny to partly cloudy skies characterized the weather pattern during the week. Daytime temperatures were in the 80s. Overnight lows dropped into the 50s and 60s late week. Harvesting activities stalled briefly in isolated areas in Louisiana and Mississippi as the remnants of Hurricane Nate brushed past the region. Most cotton acreage in Louisiana had been defoliated, but defoliation was delayed on late-planted fields in Mississippi. Ginning was in full swing as the number of modules on gin yards increased. Producers shredded stalks and prepared fields for next season. According to the National Agricultural Statistics Service’s Crop Progress report released October 10, the crop had been 63 percent harvested in Louisiana, compared to 32 percent in Mississippi. 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 very good. Average local spot prices were steady. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Interest was best from China, Taiwan, and Pakistan. Ginning continued at an accelerated pace in the Upper Coast and Coastal Bend. Harvesting was considered done, although thousands of modules remained in the fields. Gin yards were filled to capacity with modules. Ginning was finalized in the Rio Grande Valley as the two remaining gins finished late in the reporting period. Harvesting continued in the northern Blackland Prairies, with brief interruptions from rainfall. According to local experts, approximately 60 percent of the crop has been harvested. Dryland acres yielded one and one-half to two bales per acre. Modules had accumulated on gin yards. Kansas received some rain, but it caused no major delays in applying defoliants and boll openers. Harvesting was expected to expand in late October. In Oklahoma, harvesting had begun. Rainfall slowed progress, but sandy fields dried quickly. Harvesting continued. West Texas Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was very light. Average local spot prices were steady. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign inquiries were light. Interest was best from China, Taiwan, and Pakistan. A Canadian air mass moved into the area producing 40 mile per hour winds early in the reporting period, which slowed boll maturation. Cooler, drier conditions prevailed with daytime highs in the low 60s to mid-80s, and nighttime lows in the mid-30s to high 50s. Intermittent rain showers were received mostly in the northwestern parts of the region and in eastern New Mexico. Bolls in fields continued to open and some were treated with pre-harvest aids. Some fields lacked enough heat units to mature bolls. Producers made management decisions on a field-by-field basis to manage an immature crop late in the season. Irrigated fields presented about a 15-day window of varying maturity levels, according to a local producer. Harvesting and ginning had begun on a limited basis. Texas A&M Agrilife Extension Services hosted several field days and provided educational information for producers. Regional industry meetings were well attended. Trading East Texas .. A heavy volume of even-running lots mostly color 11 and 21, leaf 3 and better, staple mostly 37 and 38, mike 30-38, strength 28-38, and uniformity 79-84 sold for 69.00 to 69.25 cents per pound, FOB warehouse (compression charges not paid). .. A mixed lot containing a light volume of mostly color 32 and better, leaf 3, staple 35 and 36, mike 40-46, strength 30-31, and uniformity 80-82 sold for around 67.00 cents, same terms as above. .. A light volume of color 31, 32, and 42, leaf 3 and 4, staple 32 and longer, mike 30-46, strength 25-30, and uniformity 78-81 sold for around 62.75 cents, same terms as above. West Texas .. A light volume of 2016-crop cotton mostly color 31 and 41, leaf 5 and better, staple 33 and longer, mike 33-55, strength 25-28, and uniformity 77-80 sold for around 65.75 cents per pound, FOB car/truck (compression charges not paid). Western Markets Regional Summary Desert Southwest (DSW) Spot cotton trading was inactive. Supplies and demand were light. Producers delivered 2017-crop cotton to the co-op, merchant marketing pools, or into the CCC loan program. A light volume of producer recaps were offered and mostly for price discovery. No sales were reported. Average local prices were higher. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Clear, warm weather allowed harvesting and defoliation activities to advance in Arizona. Modules accumulated on gin yards. Local sources reported small sized bolls, but preliminary first-pick yields averaged 3 bales per acre. A couple of central Arizona gins began operations in the period. Ginning neared completion in Yuma. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were higher. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Sunny, clear conditions, with breezy afternoons were prevalent early in the period. Strong winds carried thick smoke and ash particles from wildfires raging in northern California to the Valley, which prompted air quality alerts late in the period. Defoliation and harvesting activities gained momentum. Local sources estimated that preliminary yields were 200 to 250 pounds lighter than expected, due to early season insect pressure and excessive heat during the growing season. A couple of gins began pressing operations in the period. The first new-crop samples were received in the Visalia Classing Office. American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were steady. A few local merchants offered bids for new-crop cotton, but producers were not inclined to accept. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Shippers offering prices remained firm. Interest was best from Bangladesh, China, India, and Vietnam. Temperatures were in the 70s to 90s in Arizona, California, New Mexico, and El Paso, Texas. An air quality alert was issued for the San Joaquin Valley (SJV) of California as heavy smoke and ash filled the air late in the period. Harvesting and defoliation activities advanced in Arizona and California. Modules accumulated in fields and gin yards. SJV sources reported preliminary yields were 200 to 250 pounds lighter than expected, due to early season insect pressure and extreme heat during the growing season. Initial ginning began in Arizona and California. The first new-crop samples arrived at the Visalia Classing Office and were graded in the period. Trading Desert Southwest .. No trading activity was reported. San Joaquin Valley .. No trading activity was reported. American Pima .. No trading activity was reported. USDA ANNOUNCES SPECIAL IMPORT QUOTA #25 FOR UPLAND COTTON October 12, 2017 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 October 19, 2017, allowing importation of 12,803,341 kilograms (58,805 bales) of upland cotton. Quota number 25 will be established as of October 19, 2017, and will apply to upland cotton purchased not later than January 16, 2018, and entered into the U.S. not later than April 16, 2018. The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period June 2017 through August 2017, 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.