Cotton Futures Gain Strength on Supply ConcernsPosted 10/09/2019 9:38AM CT |
Dec ’19 cotton futures start the morning strong on weak production and optimism on U.S./China Trade talks. After yesterday’s sell-off, cotton prices have sprung back with positive over-night sentiment regarding the upcoming negotiations. While harvest for cotton has been moving forward well ahead of the average pace, production has been limited by poor weather conditions and supplies are starting to tighten. If trade talks can offer positive headlines or a partial deal, this commodity will be very much under-valued. If trade talks end neutral or even negative there could still be a solid opportunity in this market if the USDA Crop Production and Supply/Demand report is bullish. Supply concerns are in place already, with bullish demand news I’d expect an upside break-out from consolidation, and perhaps even sustained bull trend.