Delta's Delta Visit
Sales were good at a flat 200 krb, Viet high at 128, and China far back 2nd at 27. New crop sales were 15 krb. Shipments were the flapjack of the report, at only 158 krb. This was by far the lowest of the market year, and lowest since early Nov. Perhaps this is a transition shortage, as old crop supplies draw to nothing, and the harvest is late.
Fast forward to the arrival of Delta, to the Delta. Landfall is almost exactly the last hurricane, between Cameron and Pecan Island on the coast. This is between Lake Charles and Lafayette, as the track has shifted again a few miles west. The heaviest rainfall is forecast for the western half of LA, 6" to 10", while MS, se Ark may get 3" to 6". Harvesting is ongoing in a frantic pace in LA, and may continue into Fri. Rains will reach Ark, MS Sat morn. West TN and north AL may get 1" to 2". The storm center, what's left of it, will be directly over this office at 1p Sat. Rogers will be in his truck riding and looking at fields at that time, and if you want an eyeball view, call 662-721-7985. Another broker in this office, Andrew Steinle, will be doing same in the Greenville/Lake Village area, 662-820-8713, and Michael is on call in Memphis at 901-218-5546.
Judging from maybe 6 random traders, the production figure should be right at the Informa number of 16.35 Mb. The clustering of estimates around that number suggests Informa still has a good reputation for calculating bales of cotton. Whatever number is released tomorrow, bullish traders are eagerly cutting more with Delta's Delta visit.
One truly amazing fact is that this market has nearly clawed back all of the $100/bale plunge when Corona exploded. Dec was trading 69c/70c at the time, and dozens of markets broke down and gapped lower on 2/24. A lower $, plus a Texas drought, plus 4 Dixie hurricanes have combined to lift price almost back to where the Bear started. We didn't think cotton could clear historical resistance at 66c, but here it is close to 70c on Delta's skirts. The US balance sheet could change a lot tomorrow, but the world balance sheet will still show end stocks +100Mb, and a ratio at or above 90%.
Fib counts hit today, Mon and Tue, with the most interesting being the 2 long term counts from major reversals, on Tue. A positive seasonal from 10/02 to 10/26 is working for now, and ends at about the time Dec liquidation begins. The late Oct/early Nov may be a time worth watching to see if a high forms. Oct expires today, and it appears the spot chart will gain ~100 points on the roll. No trade ideas.