By admin       2018-07-03

USDA’s last report before the webinar increased the export projection for the 2017 crop year up to 16 million bales. This has been anticipated by most folks for quite a while, he said. This is the second month in a row that USDA has increased the export estimate. Back in May, we went from 15 million to 15.5 million and then, in this month’s (June) report, went from 15.5 million to 16 million. The point is, given the shape of the U.S. crop at this stage, given the fact that exports continue to be strong, that has lowered the beginning stocks. We’re going to be carrying in half a million fewer bales and that export estimate can even go higher. Cotton futures are also being driven by developments in other parts of the world. China’s production is currently expected at 26.5 million bales, which would be a million bales less than China produced this past year. Eventually, China’s going to have to come off this import quota, he said. As a matter of fact, when I came in this morning, one of the first things that came on my computer was a news alert that China has increased their import quota by another 800,000 tons. If I do my math correctly, that’s a little over 3 million bales. The other thing we’ll mention, India’s production is uncertain, he noted. I read a little news blurb a while back about the fact that their monsoon season’s a little bit late this year. There’s still time to come out of that. Their production isn’t expected to be the same as last year, but again, this is questionable.

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