DTN Morning Cotton Commentary          12/12 06:44

   Cotton Trades Calmly Friday

   After several sideways sessions, the cotton market is slightly higher 
Friday. 

Keith Brown
DTN Contributing Cotton Analyst

   After several sideways sessions, the cotton market is slightly higher 
Friday. Thus far, for the week, the March contract is positive by a mere 14 
points! Traders are biding their time, awaiting whatever future news might 
arise to influence price direction. 

   The CFTC will release yet another backlogged Commitments of Traders Report 
on Friday. The most recent release had the managed-money funds buying back 
3,453 positions, reducing their overall net-bearish carry to 60,329 contracts. 
The agency's goal is to have all delayed data out by the end of this month.

   The U.S. dollar is somewhat steady Friday but is still set for its third 
straight weekly drop. The Federal Reserve just lowered interest rates this week 
and according to its outlook has plans for another cut or two during 2026. The 
U.S. Dollar Index, which measures the Greenback against six currency peers, is 
down more than 9% this year, on pace for its steepest annual drop since 2017.

   With 2026 just over the horizon, it is worth mentioning again that China's 
agriculture ministry has increased its 2025-26 cotton consumption forecast to 
7.6 million metric tons from 7.4 million in a previous forecast. The ministry 
cited progress in China-US trade negotiations and improved market confidence. A 
weaker U.S. dollar could easily come into play to that end.

   Daily chart support for March cotton stands at 63.50 cents and 63.00 cents, 
with resistance hovering about 64.50 cents and 65.00 cents. Friday morning's 
estimated opening volume is 5,876 contracts.

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




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