MP_CN206
Spot cotton quotations averaged 96 points lower than the previous week, according to the USDA, Agricultural
Marketing Service?s Cotton Program. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-36
and 43-49, strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets aver- aged 84.41 cents per
pound for the week ended Thursday, April 5, 2012. The weekly average was down from 85.37 cents last week, and
196.88 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of 86.51
cents on Friday, March 30 to a low of 81.53 cents on Thursday April 5. Spot transactions reported in the Daily Spot
Cotton Quotations for the week ended April 5 totaled 6,699 bales. This compares to 57,652 bales last week and
6,706 bales reported a year ago. Total spot transactions for the season were 818,108 bales, compared to 578,897
bales the corresponding week a year ago. The ICE May settlement prices ended the week at 88.54 cents, compared
to 93.54 cents last week.
Prices are in effect from April 6-12, 2012
Adjustment World Price (AWP) 80.71
ELS Competitiveness Payment 0.00
Loan Deficiency Payment (LDP) 0.00
Fine Count Adjustment 2010 Crop 0.09
Fine Count Adjustment 2011 Crop 0.14
Coarse Count Adjustment (CCA) 1.90
Source: Farm Service Agency, FSA, USDA
USDA ANNOUNCES SPECIAL IMPORT QUOTA #8
FOR UPLAND COTTON April 5, 2012
The Department of Agriculture's Commodity Credit Corporation announced a special import quota for upland cotton
that permits importation of a quantity of upland cotton equal to one week?s domestic mill use. The quota will be
established on April 12, 2012, allowing importation of 14,594,057 kilograms (67,030 bales) of upland cotton.
Quota number 8 will be established as of April 12, 2012, and will apply to upland cotton pur- chased not later
than July 10, 2012, and entered into the U.S. not later than October 8, 2012. The quota is equivalent to one week's
consumption of cotton by domestic mills at the seasonally- adjusted average rate for the period May 2011
through July 2011, the most recent three months for which data are available.
Future quotas, in addition to the quantity announced, will be established if price conditions warrant.
Southeastern Markets
Spot cotton trading was moderate. Supplies were moderate. Demand was moderate. Producer offerings were light.
Average local spot prices were lower. Trading of CCC- loan equities was inactive.
Portions of south Georgia received beneficial precipitation over the weekend. However, much of the cotton
growing area of the state remains in extreme-to-exceptional drought conditions. Additional moisture was
desperately needed to recharge irrigation ponds and increase stream flow levels. Warm conditions prevailed with
daytime temperatures in the low-to-mid 80s. The favorable weather allowed the crop season to proceed ahead of
schedule, and planting had begun in the first fields in Alabama and Georgia. Insect pressure could be heavy this
season due to the mild winter, and producers throughout the region were evaluating preventative treatment
strategies. Outside activities continued uninterrupted as producers spread fertilizer, serviced equipment, and
prepared fields for planting.
South Central Markets
North Delta
Spot cotton trading was inactive. Producer offerings and
supplies were light. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was
inactive. No forward contracting was reported.
Unseasonably warm temperatures, in some cases as high as 15 degrees above average, allowed producers to
make excellent progress with spring fieldwork. Soil moisture conditions were rated at mostly adequate to surplus.
Producers also prepared planting equipment, applied fertilizer, and pre-plant herbicides, and made final planting
decisions. According to the USDA Planting Intentions Re- port, acreage is expected to decline by 15 percent in
Tennessee, 13 in Arkansas, and zero percent in Missouri this season.
South Delta
Spot cotton trading was inactive. Supplies were moderate. Producer offerings were light. Demand was light. Aver-
age local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported.
Dry and warmer-than-average temperatures dominated the weather pattern early in the week. Warm, moist
air moved in late during the week and brought up to two inches of precipitation. According to the U.S. Drought
Monitor, adequate to surplus soil moisture conditions exist throughout the entire region. Producers were
preparing land and planting equipment, applying fertilizer, and burndown chemicals, and making final planting
decisions. Ac- cording to the USDA Planting Intentions Report, acreage is expected to decline by 8 percent in both
Louisiana and in Mississippi.
Southwestern Markets
East Texas-Oklahoma
Spot cotton trading was slow. Supplies were moderate.
Demand was light. Average local spot prices were lower. Producer offerings were light. No forward contracting
was reported. Trading of CCC-loan equities was slow. No domestic mill activity was reported. Foreign mill interest
was moderate.
In south Texas, heavy rainfall delayed planting activities early in the week. Planting continued after the fields
firmed to support equipment. Field preparation and herbicide applications in the Blackland Prairies were delayed,
because of heavy rainfall and severe storms that produced tornados. In Kansas, according to the National
Agricultural Statistics Services? Prospective Plantings released on March 30, planting intentions are expected to be
planted on
55,000 acres, and down 25,000 acres from the previous year. In Oklahoma, thunderstorms moved through the
southwestern areas including Altus, and brought one-third to one and one-half of an inches of rainfall. Warm,
sunny conditions followed the storm front with temperatures mostly in the 70s. As a result of continuous sunshine
and warming soil temperatures, producers considered planting earlier than normal. According to Oklahoma State
University Extensions? Cotton Comments released on April 3, southwestern Oklahoma has received 10.17 inches of
rain since October 2011. The drought-stricken area is improving, but reservoirs need to be recharged with more
rainfall to support irrigated farming operations. The increased moisture helped build weed populations, and
producers were busied applying herbicides. Spring tillage and seed- bed preparations were underway in Kansas
and Oklahoma.
West Texas
Spot cotton trading was slow. Supplies were heavy. Demand was light. Average local spot prices were lower.
Warm, windy conditions were prevalent, and caused some field erosion in the High Plains. In the southern Low
Plains, some areas received beneficial rainfall early in the week. Producers were vigilant in managing weed
populations that had expanded under unseasonably warm temperature highs mostly in the 70s to 90s. Field
preparations and pre-watering continued ahead of planting. According to the National Agricultural Statistics
Services? Prospective Plantings released on March 30, planted acreage in Texas is expected to be 6.8 million
acres, a 10 percent reduction from the previous year.
Western Markets
Desert Southwest
(DSW)
Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No
forward con- tracting or domestic mill activity was reported. Foreign mill inquiries were steady.
Five Arizona gins continued operations to complete the bumper 2011 crop, as planting the 2012 crop
rapidly pro- gressed. All ginning was expected to be complete in a couple of weeks. Industry representatives
reported that approximate-
ly 80 to 90 percent of cotton had been planted in Yuma, Arizona. Temperatures were in the mid-to-high 80s for
most of the
region. According to the National Agricultural Statistics Services? Prospective Plantings report released on March
30, Ari- zona cotton acreage is anticipated to be down 200,000, down 500,000 acres from the prior year.
San Joaquin Valley
(SJV)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local spot prices were
lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were steady.
A spring storm brought one-quarter to one-third of an inch of rainfall in the central and northern Valley early
in the
reporting period. Industry members reported that 40 percent of the planted acreage is committed to upland. The
remaining
60 percent of acres will be planted with American Pima. Many industry members attended annual
meetings.
American Pima
(AP)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local prices were steady.
Current and new-crop prices were virtually the same. Shippers reported offering prices to foreign mills equated
back to local prices at 135.00 cents, UD free, FOB warehouse. Producers were reluctant to contract at this time.
Some concerns mentioned were water availability, price levels, and late planting start. No foreign or domestic mill
activity was reported. Foreign mill
inquiries were steady, but mostly for off-grade
qualities.
According to the National Agricultural Statistics Services? Prospective Plantings report released on March 30,
American Pima planted acreage is expected to be 270,000 acres, down 12 percent from the previous year.
Producers in Arizona are expected to plant 4,000 acres, down 60 percent from the previous season; California
250,000 acres, down 8 percent; New Mexico 3,000 acres, down 12 percent; and Texas 13,000 acres, down 35
percent.
Textile Mill
Domestic mill buyers purchased a heavy volume of color 41, leaf 3, and staple 35 for May through August fill-in
needs. Mill buyers also purchased a moderate volume of color 42, leaf 4, and staple 33 and 34 for July delivery. A
moderate volume of 2012-crop cotton, color 41, leaf 3 and 4, and staple 34 was booked for delivery January
through December 2013. Mill buyers also inquired for a moderate volume of color 53 and better, leaf 5 and better,
and staple 32 and longer for fourth quarter 2012 delivery. A few mills planned up to two weeks of scheduled down
time for the approaching Easter holiday.
Inquiries through export channels were moderate. Representatives from Taiwan inquired for a moderate volume
of color 31, leaf 3, and staple 35 for nearby delivery. Demand was good for any discounted or low-grade styles of
raw cotton.
Southeastern Markets
Mixed lots containing color mostly 31 and 41, leaf 3 and 4, staple mostly 34 and longer, mike 37-49,
strength 28-31, and uniformity 80-82 sold for 400 to 425 points off ICE May futures, FOB car/truck, Geor-
gia terms (Rule 5, compression charges paid, 30 days free storage).
?? A moderate volume of color 41 and 42, leaf 3-5, staple mostly 37 and 38, mike 50 and higher, strength 31-
34, and uniformity 80-82 sold for around 85.00 cents per pound, FOB car/truck (Rule 5, compression
charges paid).
South Central Markets
North Delta
No trading activity was reported.
South Delta
No trading activity was reported.
Southwestern Markets
East Texas
In Texas, a moderate volume of color mostly 21, leaf 2, staple 33, mike 40-46, strength 25-28, and uni-
formity 77-79 sold for around 82.50 cents per pound, FOB warehouse (compression charges not paid).
?? A light volume of mixed lots of color mostly 22 and 32, leaf 2 and 3, staple 31 and longer, mike 46-49,
strength 23-27, and uniformity 77-80 sold for around 72.50 cents, FOB car/truck (compression charges not
paid).
In Oklahoma, a light volume of color 41 and 51, leaf 5 and 6, staple 37, mike averaging 34.1, strength av-
eraging 34.2, and uniformity averaging 82.2, with 100 percent bark sold for around 70.00 cents, same
terms as above.
A light volume of CCC-loan equities traded for 22.50 to 25.00 cents.
West Texas
A heavy volume of color mostly 21 and better, leaf 2 and better, staple 34 and longer, mike 34-47, strength
27-29, and uniformity 80-81 sold for 86.50 to 90.50 cents per pound, FOB car/truck (compression charges
not paid).
A light volume of mixed lots of color mostly 13 and 23, leaf 2 and 3, staple 30 and longer, mike 40-44,
strength 25-31, and uniformity 77-82 sold for around 65.00 cents, same terms as above.
A light volume of CCC-loan equities traded for 26.00 to 32.00 cents.
Western Markets
Desert Southwest
No trading activity was reported.
San Joaquin Valley
No trading activity was reported.
American Pima
No trading activity was reported.
Forward contracting of 2012-crop cotton. Upland cotton growers in the United States had booked about 5 percent of their ex-
pected acreage by the end of March this season. This was below the 22 percent booked through the same period last year. Contract-
ing has been most active in the south central states where about 19 percent of the crop was under contract by the end of March and
compares with 22 percent a year earlier. Southeastern states' growers had forward contracted about 8 percent, compared with
26 percent in 2011. Western states? growers had contracted about 4 percent of the crop, compared to 15 percent last year. Growers
in the southwestern states had no contracting at the end of March and compares with 21 percent last year. These estimates were
based on the National Agricultural Statistics Board's March Prospective Plantings report and informal surveys made by the USDA, Agri-
cultural Marketing Service, Cotton Program.
Weekly Cotton Review
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