Cotton Higher on Possible Shutdown End

The cotton market is somewhat higher Monday morning amid the news that there may be some movement in Congress toward ending the shutdown. Additionally, the expiration of December cotton’s options last Friday may be providing some relief as well.

USDA has announced it will release an updated crop report on Nov. 14, even in the face of a continued government shutdown. On the last published WASDE, prior to the shutdown, USDA had increased the U.S. 2025 cotton crop to 13.22 million bales versus the previous 13.21 million bales.

December cotton will enter its delivery on Nov. 21. Thus, all traders — except those intending to participate in the notice process — will have to liquidate or roll forward in time.

In Congress there is a procedural measure which might allow an end to the shutdown. Eight senators in the Democratic caucus broke with party leadership to support the deal. The bill would reopen the government into January and reverse some of the recent mass federal layoffs. It also includes future protections for government workers. The agreement does not include an extension of Obamacare credits, a key sticking point for most Democrats, but it would call for a vote on the subsidies in December.

Daily chart support for December cotton stands at 64.45 cents and 63.00 cents, with resistance at 64.70 cents and 65.45 cents. Monday morning’s estimated volume is 22,980 contracts.

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