Well tomorrow is a big day for cotton. First the USDA crop report and Supply/Demand numbers get released at 8:30 AM, and the Goldman Roll continues, then options March expire, followed by the National Cotton Council (NCC) estimate for planting intentions.
As far as what to expect, here is how January numbers compare to the estimates:
US Carry out: Jan 7.9, estimate for Feb. 7.9 to 8.9
Exports Jan 16.0, estimate for Feb 15.7 to 16
Usage Jan 4.6, estimate for Feb 4.62 to 4.7
World Carryover: 54.75
As for the NCC planting intentions, as I understand it the council will forecast U.S. cotton acreage of 9.4 million acres, according to the average estimate of nine analysts, traders and economists surveyed by Bloomberg. However, please note that actual acreage can vary dramatically from the council estimates as their forecast is based upon data obtained in surveys done from Dec 10th to Jan. 18. Just for example, you might compare that to last year when farmers planted 10.82 million acres, although the council reported their Feb 2007 estimate at 13.21 million acres.
Ending stocks should show an increase above 8 million bales. So, there you have it, those are the numbers to look for.
As for cotton trading on Thursday, they were again pressured by low export shipments. The current cotton crop year is now half over and export shipments are running at less than 39% of estimates. That means weekly shipments need to average more than 365,000 bales from now on. In addition, many traders were closed out positions in advance of the reports. That left the active March contract down 26 points, to settle at 68.41. July was 45 points lower, settling at 71.99 and December closed with a loss of 34 points at 76.70. And while prices were down on Thursday, all contracts stayed within their trading ranges.
One thing to note though was the narrowing in of the H/K spread in screen trading right on the heels of the outcry close.
News: Analysts bullish on cotton
Personally, I think a melt down is still possible and if one comes that’s when I will get aggressive about owning Dec calls. Otherwise I’m going to stay pretty neutral for the time being. Near term, I look for a range in March between 67.00 and 69.50.
Si quiere más información, por favor contáctenos,
El equipo de Brokers de Futuros USA
Fuente: MF Global
©2007 Jurgens Bauer & Associates all rights reserved.
La operación de futuros y opciones involucra riesgos de pérdida sustanciales, por lo que no es conveniente para todos los inversionistas. La información y opiniones contenidas en esta publicación, no constituyen, ni deben ser interpretadas para constituir una oferta de venta o la solicitud de compra de algún producto. La información objetiva incluida en este reporte ha sido obtenida de fuentes consideradas como confiables, aunque no esta garantizada en cuanto a su exactitud, ni tampoco en lo que respecta a su completo significado. No se asume responsabilidad con relación a ninguna declaración, así como en lo concerniente a cualquier opinión expresada aquí incluida. La confiabilidad relativa a la información en este reporte es solamente bajo riesgo del lector. Todos los comentarios están basados en opiniones.