Cotton modules in picked field. ©Debra L Ferguson
Spot quotations averaged 536 points lower 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, and uniformity 81.0-81.9) in the seven designated markets averaged 81.70 cents per pound for the week ending Thursday, October 20, 2022.
The weekly average was down from 87.06 cents last week and from 104.64 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of 84.01 cents Friday, October 14 to a season low of 78.26 cents Thursday, October 20.
Spot transactions reported in the Daily Spot Cotton Quotations for the week ended October 20 totaled 2,180 bales. This compares to 1,764 bales reported last week and 24,200 spot transactions reported the corresponding week a year ago.
Total spot transactions for the season were 33,174 bales compared to 90,828 bales the corresponding week a year ago. The ICE December settlement price ended the week at 77.40 cents, compared to 84.79 cents last week.
Cotton and Wool Outlook
The following information was excerpted from the Cotton & Wool report, released on October 14, 2022
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The 2022 U.S. upland cotton crop is forecast at 13.3 million bales, compared with last season’s 17.2 million bales. During the previous 20 years, the October upland production estimate was above the final estimate 12 times and below it 7 times; no production forecast was published in 2013. Past differences between the October forecast and the final production estimates indicate a 2 out of 3 chance for the 2022 upland crop to range between 12.4 million and 14.25 million bales.
Upland cotton production this season is forecast higher in two of the Cotton Belt regions while lower in the other two (figure 2). In the Southeast, 2022 cotton production is projected at 4.8 million bales—10 percent above 2021 and 5 percent above the 2017–21 average—as the highest area in 3 years is partially offset by a lower yield.
Cotton harvested area in 2022 is forecast at 2.6 million acres. The Southeast yield is projected at 886 pounds per harvested acre in 2022, compared with the five-year average of 868 pounds.
Southeastern Markets Regional Summary
Spot cotton trading was light. Supplies and producer offerings were light. Demand was moderate. Average local spot prices were lower. Trading of CCC-loan equities was inactive. The COVID-19 Pandemic continues to disrupt labor availability and logistics, but cities and locales were easing restrictions.
Mostly sunny conditions dominated the weather pattern across the lower Southeast during the period. A cold front moved throughout the region later in the week, and daytime high temperatures in the 70s and 80s dropped into the 60s. Scattered frost was observed in some areas as overnight lows dipped into the 30s. The cooler temperatures were a concern for later planted cotton fields in Central and Northern Alabama and Georgia.
Isolated shower activity brought light localized moisture to areas of North Alabama and portions of the Florida Panhandle. Precipitation totals measured from trace amounts to around one-quarter of an inch of moisture. The crop advanced, and bolls continued to crack open. Cotton strung out in bolls was reported in some fields in East Georgia that had received heavy moisture last week.
Defoliation and harvesting were ramping up. Backlogs of modules were accumulating on gin yards, and ginning was slowly expanding. According to the National Agricultural Statistics Service’s (NASS) Crop Progress report released October 17, cotton bolls opening reached 94 percent in Alabama and 92 percent in Georgia; cotton harvested reached 33 percent in Alabama and 27 percent in Georgia.
Clear and sunny conditions prevailed across the upper Southeast during the period. Daytime high temperatures in the 80s dipped into the 60s as a cold front moved across the region. Defoliation and harvesting expanded. Producers in the Lowcountry region welcomed the dry conditions where harvesting had stalled due to wet weather the previous period. Some producers in the Pee Dee region reported cotton laying in some fields but still intended to harvest.
According to NASS, bolls opening was at 97 percent in Virginia, 96 in North Carolina, and 94 percent in South Carolina; cotton harvested was at 42 percent in Virginia and 26 percent in North Carolina and South Carolina.
Textile Mill
Domestic mill buyers inquired for a moderate volume of color 51 and better, leaf 5 and better, and staple 32 and longer for first quarter through fourth quarter 2023 delivery. No sales were reported. The undertone from mill buyers was cautious as yarn demand continued to soften due to weaker demand throughout retail sectors. Mills continued to produce personal protective equipment for frontline workers and consumers.
Demand through export channels was light to moderate. Taiwanese mill buyers inquired for a strict low middling style of cotton for nearby shipment. No sales were reported. Domestic cotton shippers reported some cancellations due to weaker demand throughout the Far East.
Trading
- A moderate volume of color 31 and 41, leaf 3 and 4, staple mostly 36 and 37, mike 37-49, strength 28-30, and uniformity 80-82 sold for around 575 points on ICE December futures, FOB car/truck, Georgia terms (Rule 5, compression charges paid, 30 days free storage).
- A light volume of 2021-crop cotton, color 51, leaf 3 and 4, staple 34-37, mike 43-49, strength 25-28, uniformity 78-80, and containing 20 percent extraneous matter sold for around 1000 points off ICE December futures, same terms as above.
South Central Markets Regional Summary
North Delta
Spot cotton trading was inactive. Supplies of available cotton were light. Demand was very light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. The COVID-19 virus continues to negatively impact domestic and international marketing channels, consumer-goods supply chains, and the labor force overall.
Erratic temperatures dominated the weather pattern during the week. A cold front brought stormy conditions and freezing temperatures to the Memphis territory. About one inch of rain was reported. Daytime temperatures were in the 50s to the 70s. Cool overnight temperatures dropped down to the 30s and 40s. Boll opening was complete, and defoliation was winding down as harvesting gained momentum in all areas.
Gins accumulated backlogs of modules. According to the National Agricultural Statistics Service’s Crop Progress report released on October 17, harvesting had reached 50 percent in Arkansas, 30 in Missouri, and 32 percent in Tennessee. All of the figures for Missouri and Tennessee were about a week behind the five-year average. Some producers in Tennessee reported lower-than-average yields due to dry conditions during the growing season. Virtual and in-person industry meetings were being planned and attended.
South Delta
Spot cotton trading was inactive. Supplies of available cotton were light. Demand was very light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported. Domestic and international marketing channels, supply chains, and labor forces overall are still being negatively affected by the COVID-19 virus.
A cold front brought a brief period of cool temperatures, which then soared back into the mid- 80s. A freeze warning was issued as overnight temperatures dipped into the upper 20s. No rainfall was reported, and ideal harvest conditions continued to prevail. Ginning was in full swing throughout the region. Backlogs of modules continued to accumulate on gin yards.
According to the National Agricultural Statistics Service’s Crop Progress report released on October 17, harvesting advanced steadily to 87 percent completed in Louisiana and 63 percent in Mississippi. A few producers reported yield losses and quality reductions due to heavy rainfall in August. Virtual and in-person industry meetings were being planned and attended.
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 light. Supplies and producer offerings were moderate. Demand was light. Producers continued to deliver bales to fulfill contracts. Average local spot prices were lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Most mills were on the sidelines due to volatile ICE futures markets and declining consumer demand.
Gins continued pressing bales in the Rio Grande Valley, the Coastal Bend, and in the Upper Coast as the season draws to a close. Producers prepared fields for spring planting, but experienced delays from a cold front that brought heavy thunderstorms and high winds. The rainfall was beneficial to help moisten dried soils.
In the Blackland Prairies, some areas received a light amount of rainfall, but ginning continued. Daily inbound warehouse receipts slowed in East and South Texas as the season drew to an end. Shippers and warehousemen reported loads flowed through shipping channels well. Some slowdowns were reported, and some consignments were bumped by shipping lines. Overall, the decreased production in the state did not increase the strain on cargo capacity.
In Oklahoma, precipitation totals were light with daytime high temperatures in the 80s. Less than half an inch of moisture was received at most locations. Harvesting expanded, and modules had begun to accumulate on the gin yards. Ginning was not expected to increase until November 1. Good rain chances were in the nearby forecast.
In Kansas, harvesting and ginning continued with daytime highs in the mid- 50s to mid- 80s and overnight lows in the upper 20s to mid- 40s. The first freeze of the season failed to enhance defoliation, even on fields that had two applications of harvest aids. According to local sources, yields from dryland fields have been 300 to 400 pounds of seed cotton, but were better in Southeast Kansas. Irrigated circles were yielding around 1200 pounds.
The Abilene Classing Office reported that 2 gins from Kansas submitted 3,385 bales graded with the season average predominate color 21 at 31.5 percent, leaf 3 at 63.9 percent, staple averaging 33.82, mike averaging 4.30, strength averaging 30.57, and uniformity averaging 80.51 for week ending October 20. .
The Abilene Classing Office reported that 4 gins from Oklahoma submitted 2,812 bales graded with the season predominate color 21 at 50.2 percent, leaf 2 at 51.1 percent, staple averaging 36.30, mike averaging 4.41, strength averaging 31.77, and uniformity averaging 81.24.
West Texas
Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was light. Average local spot prices were lower. Producer interest in forward contracting was light. Trading of CCC-loan equities was inactive. Foreign mill inquiries were light. Harvesting and ginning expanded with daytime high temperatures in the low 50s to upper 80s. Spraying harvest aids and fieldwork was interrupted by cool, wet weather that brought rainfall and left fields soggy.
Various locations in the Panhandle experienced their first freeze of the season. Some fields had stalks shredded and were prepped for planting winter wheat. Modules slowly accumulated at gin yards, and a few more gins started seasonal operations.
The Lamesa Classing Office reported that two gins submitted 2,164 bales graded with the season average predominate color 21 at 73.2 percent, leaf 3 at 43.1 percent, staple averaging 35.96, mike averaging 4.46, strength averaging 31.91, and uniformity averaging 80.76 for week ending October 20.
Trading
East Texas
- In Texas, mixed lots containing a moderate volume of color 32 and better, leaf 4 and better, staple 35 to 38, mike 44-52, strength 27-33, and uniformity 79-82 sold for around 84.75 cents per pound, FOB warehouse (compression charges not paid).
West Texas
- No trading activity was reported.
Western Markets Regional Summary
Desert Southwest (DSW)
Spot cotton trading was inactive. Supplies and demand were light. Producer’s price ideas were firm for new-crop cotton. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Most mills were on the sidelines due to volatile ICE futures markets and declining consumer demand. The U.S. continues in COVID-19 Pandemic status.
Temperatures were in the 80s in central Arizona. Thunderstorms brought heavy rains to the Phoenix area early in the reporting period. Official measurements recorded nearly one inch of rainfall. Ginning continued uninterrupted in Yuma and in New Mexico. No ginning was reported in Central Arizona and El Paso, TX. Scattered showers were reported in New Mexico and the El Paso, TX territory.
Precipitation amounts ranged from one-quarter of an inch up to three-quarters of an inch. Local sources reported recent rain events coupled with rains received in September have delayed the start of harvest. Some fields were still green and have not reached cut-out stage. This is about a month behind schedule.
San Joaquin Valley (SJV)
Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. Producer’s price ideas were firm for new-crop cotton. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Interest was best from Thailand. Most mills were on the sidelines due to volatile ICE futures markets and declining consumer demand. The U.S. remains in COVID-19 Pandemic status.
Mostly sunny conditions with temperatures in the 80s dominated in the territory. No rainfall was received in the period. Cloudy conditions moved in late in the period. Harvesting was active. A few gins were pressing cotton. Producers shredded stalks in compliance with the California Pink Bollworm program.
The Visalia Classing Office reported 2,505 California bales graded with the season average predominate color 11 at 71 percent, leaf 2 at 36 percent, staple averaging 36.37, mike averaging 4.67, strength averaging 31.80, and uniformity averaging 80.97 for week ending October 20.
American Pima (`)
Spot cotton trading was inactive. Supplies and demand were light. No forward contracting or domestic activity was reported. Producer’s price ideas were firm for new-crop cotton. Average local spot prices were steady. Foreign mill inquiries were light and mostly for price discovery.
Mill demand declined due to slowed retail orders and consumer demand. Some mills carried a large amount of yarn inventory. According to the Foreign Agricultural Service, U.S. Export Sales report 103,500 bales of Pima cotton were committed for export for the week ending October 13. The U.S. remains in COVID-19 Pandemic status.
Temperatures were mostly in the 80s for the region. Showers entered the Desert Southwest early in the reporting period. Precipitation amounts ranged from one-quarter of an inch up to one inch. Defoliation activities were slowed by rain events in New Mexico and El Paso, TX. Local sources reported some fields were still too green and had not reached cut-out stage. Defoliation was delayed in West Texas as rain moved through the area. Some fields were picked, but most harvesting was slowed by rain. Limited ginning could start next week.
Harvesting is active in the San Joaquin Valley of California. Modules were trucked to gin yards. Producers were disappointed with early yield results that were average. Producers shredded stalks in compliance with the California Pink Bollworm program. The Visalia Classing Office reported 9,011 bales graded with the season average predominate color 1 at 83 percent, leaf 1 at 74 percent, staple averaging 46.95, mike averaging 3.94, strength averaging 40.72, and uniformity averaging 85.75 for week ending October 20.
Trading
Desert Southwest
- No trading activity was reported.
San Joaquin Valley
- No trading activity was reported.
American Pima
- No trading activity was reported.
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