Weekly Cotton Market Review
February 26, 2021
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Spot quotations were up 217 points from 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 86.90 cents per pound for the week ending Thursday, February 25, 2021.
This is the highest weekly average since week ending June 14, 2018 when the
average was 90.27. The weekly average was up from 84.73 cents last week and
from 60.84 reported the corresponding period a year ago. Daily average quotations
ranged from a season high of 88.80 cents Wednesday, February 24, to a low of
84.80 cents Thursday, February 25. Spot transactions reported in the Daily Spot
Cotton Quotations for the week ended February 25 totaled 16,250 bales. This
compares to 9,626 reported last week and 21,679 spot transactions reported the
corresponding week a year ago. Total spot transactions for the season were
1,247,695 bales compared to 1,325,024 bales the corresponding week a year ago.
The ICE May settlement price ended the week at 89.69 cents, compared to 90.30
cents last week.
Southeastern Markets Regional Summary
Spot cotton trading was light. Supplies and producer offerings were light.
Demand was good. Average local spot prices were higher. Trading of CCC-loan
equities was inactive. The COVID-19 Pandemic continues to negatively affect
cotton demand and disrupt supply chains.
Sunny to mostly cloudy conditions prevailed across the lower Southeast
during the period. Seasonably cold daytime high temperatures in the
upper 40s to upper 50s warmed into the mid-70s later in the week.
Scattered showers brought around one to one and one-half inches of
moisture to areas from the Gulf to Atlantic Coasts. Lesser accumulations of
one-quarter to one-half of an inch were observed in most of central and north
Alabama. Fieldwork was delayed due to wet conditions. A few gins remained on
gin days as they waited for the last remaining fields to be harvested and the
last modules to arrive on gin yards. Producers, ginners, and industry members
attended virtual industry meetings and production seminars.
A mix of sunny and overcast conditions were observed across the upper
Southeast as scattered storms moved across the region throughout the period.
Seasonably cold daytime high temperatures in the mid-to-upper 40s over the
weekend warmed into the 60s and 70s later in the week. Widespread showers
brought moderate rainfall to areas throughout the Carolinas and Virginia.
Weekly accumulated rainfall totals measured from 1 to 2 inches, with heavier
amounts observed along the coastal Carolinas. Fieldwork activities remained
at a standstill. A few gins remained on gin days as they waited for the
final modules to arrive on gin yards. Producers, ginners, and industry
members attended virtual industry meetings and production seminars.
Textile Mill
Buyers for domestic mills purchased a light volume of color 41, leaf 4,
and staple 35 and longer for March and May delivery. Mill buyers inquired
for a heavy volume of 2021-crop cotton, color 41-51, leaf 5 and better, and
staple 32 and longer for November 2021 through December 2022 delivery. No
additional sales were reported. Finished product demand had improved at some
smaller mills and operating schedules continued to incrementally increase at
some locations. Mills continued to produce personal protective equipment for
frontline workers and military supplies.
Demand through export channels was moderate, but sales had tapered due
to rising ICE futures prices. Agents for mills in China and Korea inquired
for a moderate volume of USDA Green Card Class, color 31, leaf 3, and staple
37 for nearby and August shipment. Agents for mills in Thailand and Vietnam
inquired for a moderate volume of color 21 and 31, leaf 2 and 3, and staple
34 and 35 for April and May shipment. No sales were reported.
Trading
� A light volume even-running lot containing color 41, leaf mostly 3, staple 36,
mike 40-45, strength 30-32, uniformity averaging 81.5, and 25 percent seed coat
fragments sold for 91.00 cents per pound, FOB car/truck, Georgia terms (Rule 5,
compression charges paid, 30 days free storage).
South Central Markets Regional Summary
North Delta
Spot cotton trading was inactive. Supplies of available cotton and demand
were light. Average local spot prices were higher. Trading of CCC-loan
equities was inactive. Producers booked a light volume of 2021-crop CCC-loan
equities as ICE December futures prices rose steadily during the week. The
COVID-19 Pandemic continues to negatively impact the overall global economy,
but daily infection rates have been declining in most places. Vaccinations
were progressing steadily in all areas.
Seasonably mild climatic conditions returned after a week of extreme winter
conditions and heavy snowfall. Daytime highs rebounded sharply from the single
digits to the 50s and 60s by the end of the week. Overnight temperatures were
in the 30s and 40s, near the historical average. According to the U.S. Drought
Monitor, sufficient precipitation was received in the past week to reduce the
areas of moderate drought in western Tennessee. More precipitation would be
helpful to fully recharge subsoil moisture levels. Producers were encouraged
by the strong showing of commodity prices, but many were still hoping for even
higher prices before booking the remainder of their estimated 2021 cotton
production. Producers and other interested parties participated in virtual
industry meetings and educational seminars.
South Delta
Spot cotton trading was inactive. Supplies of available cotton and demand
were light. Average local spot prices were higher. Trading of CCC-loan
equities was inactive. Strong commodity prices encouraged producers to book
a light volume of 2021-crop cotton. The COVID-19 Pandemic continues
to negatively impact the overall global economy, but daily infection rates have
been declining in many areas. Vaccinations were moving forward at a steady pace
in all areas. Seasonably average weather conditions returned after a week of
extreme winter temperatures and precipitation. High temperatures were in the
60s and 70s. Overnight lows were in the 40s to 60s. Producers were encouraged
by the bullish nature of the ICE December futures prices as they continued
planning crop selections for the upcoming planting season. No fieldwork was
reported. According to the U.S. Drought Monitor, the precipitation received
in the past week helped reduce the areas of moderate drought in Louisiana and
Mississippi, but more rain is needed to fully recharge the soil moisture
profile. Producers and other members of the cotton industry participated in
a hybrid virtual/live Louisiana Cotton and Grain Producers annual meeting,
as well as other virtual industry events and educational seminars.
Trading
North Delta
� Producers booked a light volume of CCC-loan equities for 28.00 to 29.00 cents per pound.
South Delta
� Producers booked a light volume of CCC-loan equities for 28.00 to 29.00 cents per pound.
Southwestern Markets Regional Summary
East Texas
Spot cotton trading was moderate. Supplies and producer offerings were moderate.
Demand was moderate. Average local spot prices were higher. Producer interest in
forward contracting was heavy. Trading of CCC-loan equities was slow. Foreign
inquiries were light. Interest was best from Pakistan, Taiwan, and Turkey. The
COVID-19 Pandemic continued to influence marketing logistics and impact global
cotton demand. Medical communities continued administering vaccinations.
The visible remnants of last week�s winter storm melted away and more
seasonable temperatures prevailed in the Rio Grande Valley (RGV) and in south
Texas. Daytime highs were in the low 50s to low 80s with overnight lows in the
30s to mid-50s. Fieldwork was active in the RGV with a light volume of cotton
fields planted. Rain is in the nearby forecast for the Upper Coastal counties
and fields were prepared. Planting seed was stored at warehouses, but delivery
to the producers was lagging due to the impact of COVID-19 slowing normal
operations, according to local reports. Seed was booked in the Blackland Prairies,
where activities centered around repairs following the storm.
In Kansas, topsoil moisture supplies were rated 15 percent very short,
27 short, and 51 percent adequate, according to the National Agricultural
Statistics Service�s Crop Progress report published on February 22. Subsoil
moisture was rated similar at 15 percent very short, 29 short, and 52 percent
adequate. Gins were shutdown temporarily to allow the natural gas and electric
rates to moderate. The ground remained frozen and fieldwork was inactive. Fewer
acres were expected to be planted next season for different reasons including
crop rotations. In Oklahoma, fieldwork was active until rainfall stopped all
activities at the end of the period. A heavy amount of planting seed had been
booked. There was renewed interest in cotton planting as prices moved higher.
West Texas
Spot cotton trading was moderate. Supplies and producer offerings were light.
Demand was moderate. Average local spot prices were higher. Producer interest
in forward contracting was light. Trading of CCC-loan equities was slow. Foreign
inquiries were light. Interest was best from Pakistan, Taiwan, and Turkey. COVID-19
vaccination distributions were underway, but were hampered by inclement weather that
left available appointments unused during the period.
Accumulated ice and snow melted early in the period with daytime highs in the
low 40s to upper 60s. Overnight temperatures were in the teens to low 40s. All
precipitation was beneficial, but the amounts received were light. More rainfall
is needed to help ease droughty conditions. Daytime temperatures moved above the
freezing mark for the first time in more than eight days for most locations.
Damage assessments were underway for equipment, facilities, crops, and livestock.
The week following the historic arctic storm Uri was focused on recovery and
normalization. Water well companies were inundated with repairs to agricultural
water pumping systems, as well as commercial and residential facilities. Restoring
electricity was also a high priority. Many of the weather stations lost electricity
and data transmission was interrupted. Ginning continued. Recently planted cover crops
were damaged and will not be replanted. Producers continued to weigh their planting
options. Planting seed was booked and a few retailers received seed deliveries.
Trading
East Texas
� In Kansas, a light volume of color 43 and 44, leaf 3-6, staple 34 and longer,
mike averaging 40.1, strength 26-29, uniformity 80-81, and 75 percent extraneous
matter sold for around 71.00 cents per pound, FOB car/truck (compression charges not paid).
� In Oklahoma, a light volume containing color 21 and 31, leaf 2 and 3, staple 36
and longer, mike 35-46, strength 29-35, and uniformity 78-82 sold for around 91.50
cents, same terms as above.
� A light volume of color 22 and 32, leaf 3-6, staple 35-37, mike averaging 35.8,
strength 32-35, uniformity 80-82, and 50 percent extraneous matter sold for around
82.50 cents, same terms as above.
� A light volume of CCC-loan equities traded for 12.75 to 27.50 cents.
West Texas
� A heavy volume of color 11 and 21, leaf 3 and better, staple 37 and longer,
mike 30-34, strength 28-34, and uniformity 77-82 sold for around 85.00 cents per
pound, FOB car/truck (compression charges not paid).
� A moderate volume mixed lot containing color 33 and better, leaf 2-7, staple 37
and longer, mike 30-46, strength 28-35, uniformity 77-84, and 25 percent extraneous
matter sold for around 81.00 cents, same terms as above.
� Mixed lots containing a moderate volume of color 22 and better, leaf 3 and better,
staple 34 and 35, mike 31-36, strength 29-34, and uniformity 78-80 sold for around
80.00 cents, same terms as above.
� A light volume containing mostly color 21 and 31, leaf 3 and 4, staple 36 and 37,
mike 27-30, strength 29-34, uniformity 77-88, and 50 percent extraneous matter
sold for around 73.00 cents, same terms as above.
� A light volume of CCC-loan equities traded for around 19.00 cents.
Desert Southwest (DSW)
Spot cotton trading was slow. Supplies and producer offerings were moderate.
Demand was moderate. Average local spot prices were higher. Cooperatives and
merchants opened pool sign-ups. No domestic mill activity was reported. Foreign
mill inquiries were light. Competitive foreign growths such as Brazilian and Indian
cotton as well as U.S. off-qualities were attractively priced to mill buyers.
Slight improvements were noted in consumer spending, world economies, labor, and
demand for agricultural products due to COVID-19 vaccines becoming more widely
available, various government stimulus programs, and local and regional recovery
efforts.
Daytime high temperatures were in the mid-70s in central Arizona. Planting
continued in Yuma. Local sources estimated 25 to 30 percent of the crop was planted.
Mostly sunny conditions kept daytime high temperatures in the 60s and 70s for
New Mexico and El Paso, TX. Overnight lows were in the 30s. Fieldwork was active
in the region. No moisture was recorded in cotton-growing areas of the DSW.
San Joaquin Valley (SJV)
Spot cotton trading was inactive. Supplies and demand were light. Average local
spot prices were higher. Producers inquired for 2021-crop forward contracts.
Cooperatives and merchants opened pool sign-ups. No forward contracting or
domestic mill activity was reported. Foreign mill inquiries were light.
Competitive foreign growths such as Brazilian and Indian cotton were
attractively priced to mill buyers. Some improvements were noted in consumer
spending, world economies, labor, and demand for agricultural products due
to COVID-19 vaccines becoming more widely available, various government
stimulus programs, and local and regional recovery efforts.Temperatures were
in the high 60s to low 70s. Producers prepared fields and equipment for
planting. Producers considered spring planting options.
American Pima (AP)
Spot cotton trading was active. Supplies and producer offerings of 2020-crop
cotton were heavy. Demand was good. Average local spot prices were higher.
No forward contracting or domestic mill activity was reported. Foreign mill
inquiries were slow. Shippers� offering prices for 2020-crop cotton were firm.
Some improvements were noted in consumer spending, world economies, labor, and
demand for agricultural products due to COVID-19 vaccines becoming more widely
available, various government stimulus programs, and local and regional recovery
efforts.
Temperatures were in the 60s and 70s. No moisture was recorded in the period.
Planting was active in Yuma, AZ. Fieldwork was active across the region. The final
2020-crop samples were received at the Visalia Classing Office from Arizona gins.
Ginning continued in the San Joaquin Valley of California.
Trading
Desert Southwest
� A heavy volume mixed lot mostly color 21 and better, leaf 2 and better, staple 35
and longer, mike 35-50, strength 28-33, and uniformity 78-83 sold for around 500 points
off ICE May futures, uncompressed, FOB warehouse.
� A moderate volume of color 21 and 31, leaf 1 and 2, staple 36 and longer, mike 43-55,
strength 29-33, and uniformity 79-83 sold for around 650 points off ICE May futures,
same terms as above.
� A moderate volume of Arizona 2021-crop cotton for contract base quality color 31, leaf 3,
and staple 36 was booked at even to 50 points on ICE December futures. These contracts
were subject to government discounts.
San Joaquin Valley
� No trading activity was reported.
American Pima
� A moderate volume of color 2, leaf 2, and staple 48 traded for around 140.00 cents
per pound, UD free, FOB warehouse.
� A light volume of color mostly color 1, leaf 1, and staple 50 traded for around 139.00
cents uncompressed FOB warehouse.
USDA ANNOUNCES SPECIAL IMPORT QUOTA #19
FOR UPLAND COTTON
February 25, 2021
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 March 4, 2021,
allowing importation of 8,648,011 kilograms (39,720 bales of 480-lbs)
of upland cotton.
Quota number 19 will be established as of March 4, 2021 and will
apply to upland cotton purchased not later than June 1, 2021 and entered
into the U.S. not later than August 30, 2021. The quota is equivalent to
one week's consumption of cotton by domestic mills at the seasonally-adjusted
average rate for the period October 2020 through December 2020, 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.