Economic Observation: Weak US Cotton Export Shipment Data Failed To Reverse The Decline

On Friday (18th), ICE cotton ended lower as a whole. The settlement price of December contract was 71.93 cents, down 14 points; The settlement price of the contract in March was 73.76 cents, down 16 points; The settlement price of the contract in May was 75.07 cents, down 20 points.

The contract opened slightly lower in December, and the market remained volatile due to the lack of clear guidance on positive factors. Due to the weak export shipment data of American cotton, the trading center of gravity fell and hit the intraday low. Later, supported by the entry of some buying funds, the trading center of gravity fluctuated upward. Up to the intraday high of 72.45 cents, some funds took profits, and the trading center fell slightly. At the end of the day, it failed to reverse the intraday decline, and ended with a slight decline.

According to USDA data, the contract signing of American Upland Cotton has been halved again, and the momentum of shipment has slowed down significantly month on month. Specifically, the net contracting volume of American upland cotton in 2023/24 in the week from July 7 to July 11 is 6169 tons (including 8822 tons of contracted cotton and 2654 tons of early contracted cotton cancelled), a decrease of 50% compared with the previous week and an average decrease of 76% compared with the last four weeks. 25651 tons of upland cotton were shipped, 30% less than the previous week, and 33% less than the last four weeks on average. The net contracted Pima cotton of this year was 862 tons, 4% less than that of the previous week; 975 tons of Pima cotton were shipped, an increase of 126% over the previous week. This week, 37557 tons of new year upland cotton and 476 Pima cotton were signed.

The dollar index in the peripheral markets rose; Soybean futures closed higher, wheat and corn (2388, 9.00, 0.38%) futures closed lower. The three major US stock indexes fell collectively, while the S&P, Nasdaq and Dow all closed lower. International oil prices fell, US oil and oil distribution both ended lower.

The total turnover on the 18th was about 13900. As of December 17, 156501 contracts were held, 207 fewer than the previous day; The contract positions in March were 34518, 277 fewer than the previous day; In May, there were 10442 contract positions, 270 more than the previous day; The total positions were 218622, one more than the previous trading day. ICE registered 41122 packages of inventory, which remained unchanged for three consecutive trading days.