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eCOOPNEWS Volume 8 Number 3


Commodity Comment
The cotton market continued to push higher this week led by strong demand and spec short covering.  For the fourth week in a row export sales have exceeded expectations, and during that time we have sold almost 2 million bales.  It seems that cotton demand is strong and mills that had been waiting to cover their high grade needs were forced to go ahead and cover before the high grades got sold out.  USDA will most likely raise exports on Monday’s report and the talk is that we will eventually export 11 mln bales or so which is 1 mln bales above the current estimate. Next week’s report will likely show smaller US ending stocks which should help keep the market firm.  The shrinking LDP will also raise the level at which growers are willing to sell which will be supportive to prices as well.  The only headwind to stronger cotton prices right now is macro headwinds led by the strong US $ and specs wanting to short commodities in general.  For the week Mar closed at 6159 up 223 pts and Dec closed at 6320 up 41 pts.  The National Cotton Council will release their acreage estimate tomorrow morning which should give new crop Dec futures some direction next week. 
Grain futures were firmer this week as well due to a pickup in demand at the recent lows.  Wheat corn and beans all saw good export sales this week and have moved back up against trend line resistance.  It will take a bullish report Monday to break them out to the upside and most likely a weaker $ as well.  If only one or both of those things happen we will most likely resume the downtrend next week.  For the week Jul wheat closed at $5.31 up 30 cents for the week, Nov beans $9.60 up 15 cents and Dec corn $4.16 up 16 cents.
                                                                Wayne Boseman
                                                                VP Brokerage


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