DTN Morning Cotton Commentary          08/11 07:19

   Cotton Higher, Conditions Lower 

   The cotton market is seeing higher prices Tuesday morning amid a somewhat 
worsening situation with the condition of 2026 U.S. crop. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is seeing higher prices Tuesday morning amid a somewhat 
worsening situation with the condition of 2026 U.S. crop. Traders are also 
awaiting Wednesday's WASDE update, as well as new CPI numbers.

   Monday afternoon, USDA released fresh crop progress numbers. The weekly 
report showed 40% of the domestic cotton crop was rated good to excellent. That 
number was down from 42% the previous week and below the 53% pace from one year 
ago. The five-year average for this date stands at 47% good to excellent. 
Specifically, Texas was 24% good to excellent versus 28% last week, 44% a year 
ago, and the five-year average of 34%. Georgia was 62% good to excellent, up 
from 60% last week but down from 65% a year ago and below the five-year average 
of 66%. The report also showed 65% of the crop was setting bolls versus 64% a 
year ago and a five-year average of 67%.

   Wednesday, USDA will issue its monthly crop supply-demand summary. Estimates 
call for a slightly smaller crop than the July WASDE's 13.7 million bales. 
Yield is the big question. Last month, the national yield was pegged at 872 
lb./harvested acre, up from 866 in June. Of course, that July number was 
model-based, while Wednesday's release will be USDA's first survey-based yield 
estimate. Those surveys are based on grower surveys conducted from July 25 to 
August 5. The report is out at noon, eastern time.

   Also Wednesday, fresh CPI numbers will be released. The current estimates 
are: Headline CPI: +0.1% to +0.2% month-over-month, with consensus around 
+0.2%. Core CPI: +0.2% month-over-month is the broad expectation. Headline YoY: 
around 3.4%, Core year-over-year: around 2.8%. Supposedly, a 0.2% print would 
be broadly in line; 0.3%+ would likely be viewed as hot, while 0.1% would be a 
meaningful downside surprise.

   On Thursday, USDA will issue fresh export sales numbers. Last week's data 
saw the final 2025 sales number of 55,600, a marketing-year-low. Net sales for 
2026 were 242,000 bales sold, with 222,800 bales shipped, off five percent 
weekly.

   Crude oil is trading somewhat higher Tuesday morning, after its sharp rise 
on Monday. Hopes are dwindling for a U.S./Iran deal to fully reopen the Strait 
of Hormuz. Interestingly, recent data shows U.S. crude oil stockpiles have 
fallen to their lowest level in more than four decades!

   Chart support for December cotton stands at 83.00 cents and 82.65 cents, 
with resistance around 85.00 cents and 85.50 cents. Tuesday morning's estimated 
volume is 6,872 contracts.

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




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