General Comments: Futures moved to new contract lows as the market is still preoccupied about the large supply overhang in the market. There was not much in the press in the way of news. The primary focus of the market remains big supplies. Thai offers are stable as the harvest is very active there and differentials have been steady to lower. India was very active earlier but seems quieter now and there are some reports of production losses there. Brazil is offering less now that the harvest season is over. Demand might be getting better, but still have not been able to change the trend much. Weather conditions in key production areas around the world are rated as mostly good.
Overnight News: Brazil could see dry weather and above normal temperatures.
Chart Trends: Trends in New York are down with objectives of 1570 March. Support is at 1550, 1520, and 1490 March, and resistance is at 1590, 1600, and 1620 March. Trends in London are mixed to down with objectives of 427.00 March. Support is at 432.00, 429.00, and 426.00 March, and resistance is at 438.00, 443.00, and 445.00 March.
General Comments: Futures closed lower on worries about Chinese demand. Calcot said Tuesday that Chinese production could drop by as much as 20% in the coming year. It said that the government there will most likely buy no Cotton for the reserve program and that imports for the next crop year could drop by 45% as the government there seeks to get out of the supply management of the market. Instead, the government will move to payments to producers to support production. Traders think USDA can show reduced production this year and perhaps reduced planted area potential for the coming year in the reports Friday. Reduced production from the crop last year is very possible given that USDA showed good yields in the production reports this fall despite some very stressful weather seen over the Summer in Texas and over to the Southeast. The US economy is improving slowly and should support increases in demand over time as people start to buy clothes again. Brazil conditions are reported to be very good in Bahia.
Overnight News: The Delta and Southeast will see precipitation late in the week and a dry weekend. Temperatures will average above normal. Texas will see dry conditions except for rain tomorrow. Temperatures will average too much above normal. The USDA spot price is 81.16 ct/lb. today. ICE said that certified Cotton stocks are now 0.042 million bales, from 0.037 million yesterday. USDA said that net Upland Cotton export sales were 68,100 bales this year and 0 bales next year. Net Pima sales were 8,200 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 82.70, 81.50, and 80.80 March, with resistance of 83.80, 84.20, and 85.00 March.