DTN Morning Cotton Commentary          09/11 07:42

   Cotton Lower Ahead of WASDE Report

   The cotton market is moderately lower, as traders position themselves for 
Friday's supply-demand update and the sharp reversal in the energy complex.

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is moderately lower, as traders position themselves for 
Friday's supply-demand update and the sharp reversal in the energy complex.

   Crude oil is sharply lower this morning as news that several Middle Eastern 
states will supposedly meet with Iran over the future of the Strait of Hormuz. 
Thursday, prices in the energy complex post near record highs.

   An updated CPI (consumer inflation) report will be out Friday at 8:30 a.m. 
EDT. Given Thursday's slightly higher PPI number, CPI will confirm, or not, the 
presence of "sticky" inflation in the U.S. economy. Thus, the Federal Reserve 
may be prompted to hike interest rates. The central banks will meet next week.

   Weekly export sales were released Friday with the following numbers:

   "Net sales of Upland totaling 73,900 RB for 2026/2027 were primarily for 
Pakistan (19,400 RB), Vietnam (17,500 RB, including decreases of 100 RB), 
Mexico (11,900 RB, including decreases of 200 RB), Bangladesh (10,500 RB), and 
India (9,500 RB, including decreases of 6,700 RB). Total net sales of 2,500 RB 
for 2027/2028 were for Mexico. Exports of 177,800 RB were primarily to Vietnam 
(50,300 RB), India (47,000 RB), Pakistan (17,600 RB), Honduras (11,800 RB), and 
Mexico (11,000 RB). Net sales of Pima totaling 10,000 RB for 2026/2027 were 
primarily for India (6,600 RB), Peru (1,900 RB), Thailand (500 RB), Bangladesh 
(400 RB), and Italy (400 RB). Exports of 5,200 RB were to India (2,400 RB), 
Pakistan (1,700 RB), Thailand (700 RB), Peru (300 RB), and South Korea (200 
RB)."

   At noon EDT Friday, USDA will release its monthly supply-demand update. For 
that report, the average trade guess calls for U.S. 2026/27 production to be 
13.19 million bales, down from the previous 13.61 million bales. Exports are 
expected to be at 12.14 million bales versus 12.30 million bales seen in 
August. Domestic stocks are expected at 3.79 million bales versus the prior 
numbers of 4.00 million bales.

   Lastly at 3:30 p.m. EDT, the CFTC will update its Commitment of Traders 
numbers. The last report had the managed-money funds as net-buyers of 12,000 
positions. Their buying action swelled the overall net-long carry to 107,936 
contracts. Their record carry was 108,788 contracts.

   For Friday, close-in support for December cotton stands at 86.10 cents and 
85.50 cents, with resistance around 89.00 cents and 89.55 cents. Friday 
morning's estimated volume is 13,260 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780.




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