Significantly higher on China weather – AgFax
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Overnight, the cotton market is turning strong with new harvest months posting new highs. Behind the move is a still bleak weather scenario for West Texas and surrounding states, as well as China’s easing of some COVID-19 restrictions on Shanghai. In addition, the intensity of the war between Ukraine and Russia is driving up most commodities.
Weather-wise, the nowcast (1-5 days) predicts no rain for West Texas. In fact, the 6 to 10 day forecast indicates a much lower than normal chance of precipitation. The 8 to 14 day outlook is less gloomy as it points to possible rain for Kansas and Oklahoma, but Texas appears to remain dry.
The USDA released its weekly crop progress report on Monday, which showed that 7% of the US cotton crop had been planted as of April 10, up from last week’s pace of 4%. sown. A year ago, the harvest was done at 8%. Texas was 12% complete, down from 6% a week ago.
May Cotton will go into her delivery on Monday, April 25. This means that all participants wishing to avoid the perils of delivery must exit their positions by the previous Friday at the latest.
For Tuesday, the close support for May Cotton is at 135.30 cents and 134.75 cents, while resistance stands at 140.00 cents and 141.10 cents. Estimated morning volume is 12,243 contracts.