Market Movement from 21st Aug 2023 to 26th Aug 2023.
New York December cotton futures recorded a value of 83.62 on August 18, which then rose to 87.31 on August 25, resulting in a weekly loss of 3.69 cents.
The strong demand in China has exerted a significant pull on the commodity market, specifically impacting the Zhengzhou Commodity Exchange (ZCE). As a result of this robust Chinese demand, the ICE December cotton future contract has experienced a substantial gain of 369 points. This positive market movement has occurred in spite of challenges such as lower export sales and a strengthened dollar. The market seems to be overlooking these factors and instead, placing emphasis on the prevailing Chinese demand.
In the 2023-2024 season, U.S. cotton export sales displayed mixed results, with net Upland sales at 38,900 bales, accompanied by substantial Upland shipments of 204,200 bales, and a moderate contribution from net Pima sales at 1,300 bales, with 9,600 bales of Pima shipped. This culminated in a total sales volume of 40,200 bales. Looking ahead to the 2024-2025 season, Upland sales surged significantly to 52,800 bales, although there were no recorded net Pima sales, resulting in a total sales volume of 52,800 bales for the season. These figures reflect the evolving landscape of U.S. cotton exports over the respective periods.
Throughout the week, the Gujcot Spot Rate demonstrated a fluctuating trend, starting at 60,600 on Monday, slightly dipping to 60,450 on Tuesday, further decreasing to 60,250 on Wednesday, experiencing a marginal drop to 60,100 on Thursday, and finally recovering to 60,200 on Friday.
A new crop arrival has commenced in Northern India, which is having a notable impact on the market dynamics. The current rate of produce from the North has become a reliable indicator for predicting price movements. Interestingly, even following a significant crash in prices within the span of a day, the rate of Northern produce has managed to stabilize.
Both Gujarat and Maharashtra are still making substantial contributions to the overall arrival of cotton.
The daily cotton arrival in India is approximately 35,000 bales, with Gujarat accounting for nearly 10,000 bales per day.
The latest All India Cotton Sowing report as of August 25, 2023, highlights diverse trends in cotton cultivation across states. Punjab noted a substantial 32.13% decrease, while Haryana saw a slight rise of 2.23%. Rajasthan's cotton sowing grew by 21.18%, contributing to North India's 4.68% increase. Gujarat's sowing expanded by 5.50%, but Maharashtra dipped by -0.18%. Central India observed a 2.14% rise, while Telangana and Andhra Pradesh decreased by -6.85% and -35.49% respectively. Karnataka and Tamil Nadu also saw declines of -15.90% and -26.04%. Overall, South Zone's sowing fell by -14.00%. Orissa increased by 8.20%, while the "Others" category dropped by -33.46%. Nationally, All India's cotton sowing contracted by -1.82%. Source: Department of Agriculture Cooperation & Farmer Welfare - Government of India.
Over the course of the week, the USD-INR exchange rate displayed a series of fluctuations, commencing at 83.10 on Monday, showing a decrease to 82.93 on Tuesday, followed by a further decline to 82.68 on Wednesday. The trend continued with a minor drop to 82.57 on Thursday, before experiencing a slight rebound to 82.64 on Friday.
The progress of the monsoon has been notably sluggish, and the entire cotton-growing region is in need of substantial rainfall.
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GUJCOT WEEKLY REPORT 30-SEP-2023
Market Movement from 25th Sep 2023 to 30th Sep 2023.
• The ICE December cotton futures traded a