DTN Morning Cotton Commentary          05/12 07:15

   Cotton Does About Face Tuesday

   The cotton market is markedly lower Tuesday after Monday's trade saw new 
life-of-contract gains. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is markedly lower Tuesday after Monday's trade saw new 
life-of-contract gains. Speculators and funds were all in the buying mood 
Monday as a bit of U.S./Chinese euphoria was in the air. Tuesday, traders will 
see updated supply-demand tables and then will better focus on this week's 
U.S./China talks.

   USDA released its weekly Crop Progress report Monday afternoon. The data 
showed 29% of the U.S. cotton crop was planted as of May 10, up from 21% the 
previous week and 27% a year ago. The five-year average for this date is 28%. 
Texas was 27% planted versus a five-year average of 26%, and Georgia was 24% 
planted versus 25% on average. Arkansas was 40% planted versus a five-year 
average of 35%, and Mississippi was 47% planted versus 36% on average

   Tuesday at noon EDT, USDA will issue its May WASDE. A survey of analysts 
showed an average trade estimate to be 13.76 million bales, which would be down 
from last year's 13.92 million. U.S. exports are expected around 12.27 million 
bales versus 12.00 million in 2025-26, and ending stocks are expected to be 
around 4.20 million bales compared to 4.40 million. World production for 
2026-27 is expected to be around 119.06 million bales versus 121.87 million 
seen in 2025-26. Global ending stocks are pegged at 75.63 million versus the 
previous 77.04 million bales.

   This week will see the Trump/Xi trade meeting in Beijing. The two sides have 
much to discuss including tariffs, Taiwan, Iran, and rare earths.

   Crude oil is higher Tuesday after President Trump declared the ceasefire 
with Iran was on "life support." Tehran's counter-proposal to end the war 
included separate talks for nuclear, U.S. reparations, and ownership of the 
Hormuz.

   Chart support for July cotton stands at 85.00 cents and 84.55 cents, with 
resistance around 88.50 cents and 89.00 cents. Tuesday morning's estimated 
volume is 30,935 contracts.

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




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