On March 31, the ICE futures market was extremely nervous before the USDA intention area was released. Coupled with fund selling at the end of the month and quarter, the market once fell by 2.5%.
The USDA intended area subsequently released showed that the intended area in the United States in 2021 is 12 million acres, which is almost the same as the forecast of the Agricultural Outlook Forum. The benefits are limited, but the intended area of corn and soybeans It was significantly lower than market expectations and directly hit the daily limit, which means that the intended area of cotton may not be accurate, so ICE futures quickly rebounded and closed higher.
Thursday’s weekly U.S. cotton export report will reflect demand last week when ICE futures fell below 80 cents, so it is likely to be a relatively strong number. In any case, the current cumulative sales have exceeded USDA’s export forecast, and the market has more reason to believe that the USDA will continue to increase U.S. cotton exports this year while reducing U.S. cotton ending stocks.
With the final release of the intended area of the United States, traders will begin to turn their attention to the weather in the United States and other cotton-producing countries in the northern hemisphere. At present, Texas in the United States is still dry, and most of the southern cotton-producing areas have very low temperatures this weekend. This weekend is the Easter holiday, and ICE futures will be closed for one day. April 1 is also the first anniversary of ICE futures hitting an epidemic low of 48 cents.
Although the ICE futures contract for this year only rose slightly on March 31, the increase of more than 100 points for the December contract in the new year is eye-catching. From now on, the hype surrounding supply and demand in the new year will gradually unfold, and the December contract will begin to lead the long-term direction of the market.
From the accelerated rise from January to February this year to the crazy decline in the past month, cotton in the post-epidemic period is like an immature child, advancing and retreating in ignorance. , fortunately, the supply and demand for next year have a rough outline. Give cotton a little more time to slowly find its own direction in the months before the new year and lay a good foundation for greater development in the future. </p
