DTN Morning Cotton Commentary          07/16 07:44

   Cotton Struggles With Technicals, Tropical Event 

   The cotton market is giving way Thursday morning for a variety of reasons.

Keith Brown
DTN Contributing Cotton Analyst

   Thus far, unable to decisively hurdle the June high of 81.61 cents, along 
with a potential tropical depression off the U.S. southeastern coast, the 
cotton market is giving way this morning. In addition, China announced she will 
auction bales from her state reserve Monday, July 20. Traders also want to see 
Thursday's retail sales, weekly export sales, and Friday's CFTC update to get a 
further measurement of the market.

   USDA just released its weekly export sales with the following numbers:

   "Net sales of Upland totaling 34,400 RB for 2025/2026--a marketing-year 
low--were down 48 percent from the previous week and 64 percent from the prior 
4-week average. Increases primarily for Bangladesh (10,600 RB), Vietnam (5,800 
RB, including decreases of 100 RB), Pakistan (5,300 RB), Peru (4,800 RB), and 
Thailand (2,700 RB, including 700 RB switched from Japan), were offset by 
reductions for Japan (1,200 RB), Bahrain (200 RB), and Turkey (100 RB). Net 
sales of 4,100 RB for 2026/2027 reported for Pakistan (4,200 RB), Peru (3,800 
RB), Vietnam (1,700 RB), and Indonesia (1,200 RB), were offset by reductions 
for Mexico (4,700 RB), Nicaragua (1,200 RB), Guatemala (500 RB), Honduras (400 
RB), and Japan (100 RB). Exports of 214,900 RB were down 7 percent from the 
previous week and 14 percent from the prior 4-week average. The destinations 
were primarily to Vietnam (77,100 RB), Turkey (36,100 RB), Pakistan (21,500 
RB), India (17,000 RB), and Mexico (14,000 RB)."

   Also on Thursday, new monthly retail sales numbers, business inventories, 
and jobless claims will be released by their various government agencies. 

   On Friday at 3:30 p.m. EDT, the CFTC will update its Commitments of Traders 
information. Last week saw the managed-money funds had net-bought some 7,100 
positions, further enhancing their net-long carry to 39,106 contracts.

   From the National Hurricane Center, we note: "An area of low pressure is 
forecast to form this weekend over the northeastern Gulf of America. Some 
gradual development of this system is possible while it moves slowly 
northeastward over the northern Gulf and near the coast of the southeastern 
United States early next week".

   Chart support for December cotton stands at 80.00 cents and 79.30 cents, 
with resistance around 82.30 cents and 83.00 cents. Thursday morning's 
estimated volume is 13,890 contracts.

    

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




(c) Copyright 2026 DTN, LLC. All rights reserved.