The cotton market is trading in the green during Monday’s trading session. That’s on top of cotton futures ending last week near the $70 mark. The Adjusted World Price (AWP) also climbed to 58 cents. It’s now at its highest point since early July.
USDA printing in its Supply and Demand Report a pullback to cotton expectations in 2019. Some analysts say it’s a ‘gift’ from the trade perspective.
“We’ve had three straight reports now where you see a reduction,” said John Payne of Daniels Trading. “We’ve slowly chopped away at that big supply story and all the while, the China trade talks have gone well.”
Payne says Texas A&M projected last week the cotton acreage will shrink 11 million acres. He believes that is a recipe for a real spike this summer.
Payne is looking at that April timeframe for prices to peak.