Mp_cn812 September 23, 2016 Weekly Cotton Market Review Spot cotton quotations were 189 points higher than the previous week, according to the USDA, Agricultural Marketing Service’s Cotton and Tobacco 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 averaged 68.60 cents per pound for the week ended Thursday, September 22, 2016. The weekly average was up from 66.71 cents last week and 58.43 cents reported the corresponding period a year ago. Daily average quotations ranged from a low of 66.49 cents Friday, September 16 to a high of 70.22 cents Thursday, September 22. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended September 22 totaled 5,901 bales. This compares to 918 bales reported last week and 4,910 spot transactions reported the corresponding week a year ago. Total spot transactions for the season were 21,032 bales compared to 32,155 bales the corresponding week a year ago. The ICE December settlement prices ended the week at 71.71 cents, compared to 67.72 cents last week. Prices are in effect from September 23-29, 2016 Adjusted World Price (AWP) 58.85 ELS Competitiveness Payment 0.00 Loan Deficiency Payment (LDP) 0.00 Fine Count Adjustment 2015 Crop 0.06 Coarse Count Adjustment (CCA) 0.00 Fine Count Adjustment 2016 Crop 0.16 Source: Farm Service Agency, FSA, USDA Regional Summaries Southeastern Market Spot cotton trading was inactive. Supplies were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. Widespread thundershower activity brought localized, variable moisture to areas across the lower Southeast during the period. Rainfall totals measured from trace amounts up to 1 inch in some areas along the Gulf Coast and inland to central Alabama and south Georgia. Despite the wet weather, defoliation expanded and harvesting activity advanced in Georgia and Alabama. Picking was underway in dryland fields that have cut-out; local experts reported 700 to 900 pounds per acre in some better yielding dryland acreage in southeast Georgia. Whiteflies and stink bugs were still present at treatable levels in some later planted fields in central Georgia. Producers applied growth regulators to drought stressed cotton that was invigorated following recent rainfall. Mostly fair-to-cloudy conditions prevailed inland across the Carolinas and Virginia during the period. Light, scattered moisture was received in some areas. Many locales in central Virginia and north central North Carolina were experiencing abnormally dry conditions. Drought stressed fields in these areas could use additional moisture to prevent yield loss. Along the Atlantic coast, overcast conditions were observed and daily intermittent shower activity brought locally heavy downpours of 2 to 6 inches of accumulated moisture to areas for the week. Bolls were beginning to crack open; defoliation was underway in the earliest-planted fields and harvesting was just getting underway in the Carolinas. The crop condition was mostly fair-to-good across the region. South Central Markets North Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Partly cloudy conditions were the norm during the period. Daytime temperatures ranged from the mid-80s to mid-90s and overnight lows were in the upper 60s to mid-70s. Rain accumulations ranged from one-quarter of an inch to two inches in the area, halting harvesting and defoliation activities. Producers stated that more rain would not be beneficial to the crop. Several gins are ramping up operations, while others will not get started until the first of October. The Dumas and Memphis Classing Offices classed their first samples for the season during the period. According to the National Agricultural Statistics Service’s Crop Progress report released September 19, boll opening surpassed the five-year average in all areas. The crop was in good-to-excellent condition in Arkansas and Tennessee, but fair-to-good in Missouri. South Delta Spot cotton trading was inactive. Supplies of available cotton were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. No forward contracting was reported. Cloudy to fair weather conditions prevailed during the period. High temperatures were in the low to mid-90s and overnight lows ranged from the upper 60s to mid-70s. Rain totals of one-quarter of an inch to two inches were observed throughout the territory, halting harvesting and defoliation activities. A continued pattern of dry weather is needed for harvesting activities to gain momentum. Producers are optimistic that yields will be above average, weather permitting. Ginning is underway on a limited basis in Louisiana. The Rayville Classing Office classed their first samples for the season during the period. According to the National Agricultural Statistics Service’s Crop Progress report released September 19, boll opening was above the five-year average in both Louisiana and Mississippi. The crop was in fair-to-good condition. Southwestern Markets East Texas-Oklahoma Spot cotton trading was moderate. Supplies and demand were moderate. Average local spot prices were higher. Trading of CCC-loan equities was slow. Forward contracting was light. Foreign mill inquiries were moderate. Rio Grande Valley gins were finishing pressing operations for the season. Harvesting in the Upper Coast had been slowed from spotty rainfall that softened soils. Regrowth and sprouting was an issue caused by excessive rainfall. In the northern Blackland Prairies, experts reported that harvesting was 10 to 30 percent completed, depending on location. Strong chances of rainfall are in the nearby forecast. Corn harvest slowed the progression of cotton harvesting. In Kansas, stands progressed under hot, humid conditions. Daytime temperatures were in the 90s. The top bolls were maturing. Some hail damage was reported in western Kansas. Industry experts report that defoliation activities were three weeks away. In Oklahoma, stands progressed. Preparations were underway for the harvesting and ginning season. Producers were encouraged with yield potential if ideal weather continues. According to the Cotton and Tobacco Program’s Quality of Cotton Classed by Classing Office, released on September 23, the Corpus Christi Classing Office had classified 750,817 samples for the season that were submitted by 51 gins. West Texas Spot cotton trading was inactive. Supplies and producer offerings were light. Demand was light. Average local spot prices were higher. Trading of CCC-loan equities was inactive. Foreign mill inquiries were moderate. Some fields have had pre-harvest aids applied on dryland cotton. Industry reports indicated that some locks were falling out of the bolls due to excessive temperatures during the growing season, and producers were eager to harvest those fields to prevent further yield loss. Additional expenses were being incurred by some at the end of the season for applying higher rates of pre-harvest aids to ensure effectiveness against regrowth. Irrigated fields progressed. Above average production was expected from irrigated fields. Producers prepared for harvesting activities. Western Markets Desert Southwest (DSW) Spot cotton trading was inactive. Supplies and demand were light. Average local prices were higher. Producers showed renewed interest in forward contracting as ICE December futures reached 70.00 cents mid-week. No domestic mill activity was reported. Foreign mill inquiries were light. Overcast skies moved into Arizona mid-period, dropping temperatures into the high 90s. Scattered showers deposited up to one-quarter of an inch of moisture in western Arizona. Harvesting reached 60 percent completion in Yuma, Arizona. Ginning continued. Defoliation and harvesting was active in central Arizona. Sources estimated less than 10 percent of the crop was harvested. Modules were in transport to gin yards. A couple of gins had enough modules to begin ginning late in the period. The crop matured under partly sunny conditions in New Mexico and El Paso, Texas. Approximately one-half of an inch of rainfall was received in Artesia, New Mexico. Sources reported defoliation activities could begin late next period. New Mexico producers are considering planting more cotton next season, due to increased inquiries for cottonseed from dairies. San Joaquin Valley (SJV) Spot cotton trading was inactive. Supplies and demand were light. Average local prices were higher. Producers inquired for forward contracting as ICE December futures reached 70.00 cents in the period. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were light. Temperatures were mostly in the mid-to-high 90s, but dropped into the mid-70s late in the period. Air quality was hazy with ash from wildfires burning in surrounding areas. No moisture was recorded in the period. Some producers began defoliating the crop. Limited harvesting began in Tulare County. Gins readied equipment for processing. American Pima (AP) Spot cotton trading was inactive. Supplies and demand were light. Average local prices were steady. Foreign mill inquiries were moderate. New-crop inquiries were for November/December 2016 shipment. Shipper’s price ideas were firm. Temperatures were in the 80s and 90s for the Far West. Scattered shower activity was reported in western Arizona and eastern New Mexico. Up to one-quarter of an inch of precipitation was received in Arizona and approximately one-half of an inch in New Mexico. Harvesting gained momentum in Yuma, Arizona, with an estimated 60 percent of the crop harvested. Modules were transported to gin yards. No ginning was reported. Defoliation activities began in central Arizona and the San Joaquin Valley of California. Sources reported limited harvesting in central Arizona. The crop made good progress in the Safford Valley of Arizona, New Mexico, and El Paso, Texas. The crop was about two to three weeks from defoliation. Textile Mill Domestic mill buyers inquired for a moderate volume of color 41, leaf 3 and better, and staple 35 and longer for January through March 2017 delivery. No sales were reported. Additional demand was good for color 41, leaf 4, and staple 34 and longer for first quarter 2017 delivery in lighter volumes to smaller mills that had not booked raw cotton needs through first quarter 2017. The undertone was cautiously steady. Reports indicated demand through retail sectors remained sluggish. Most mills operated four to seven days. Demand through export channels was moderate, but had tapered due to higher ICE Futures prices. Japanese mill buyers inquired for a moderate volume of USDA Green Card Class, color 31, leaf 3, and staple 35 and longer for November shipment. No additional sales were reported. USDA ANNOUNCES SPECIAL IMPORT QUOTA #1 FOR UPLAND COTTON September 22, 2016 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 September 29, 2016, allowing importation of 13,614,466 kilograms (62,530 bales) of upland cotton. Quota number 1 will be established as of September 29, 2016, and will apply to upland cotton purchased not later than December 27, 2016, and entered into the U.S. not later than March 27, 2017. The quota is equivalent to one week's consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period May 2016 through July 2016, 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. Regional Price Information . A light volume of 2014-crop cotton of color 41 and 42, leaf 3-5, staple 35-37, mike 50 and higher, strength 29-31, and uniformity 81-83 sold for around 63.25 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 light volume of color 21 and 31, mostly leaf 3 and 4, staple 36 and longer, mike 44-49, strength 28-33, and uniformity 78-83 sold for around 70.00 cents per pound, FOB warehouse (compression charges not paid). . A light volume of mostly color 41, leaf 2 and 3, staple 36 and longer, mike 39-49, strength 28-32, and uniformity 79-82 sold for around 69.50 cents, same terms as above. . A moderate volume of mostly color 41 and better, leaf 4 and better, staple 34, mike 43-53, strength 29-35, and uniformity 80-83 sold for around 63.75 cents, same terms as above. . A light volume of CCC-loan equities traded for around 5.00 cents. West Texas . A light volume of CCC-loan equities traded for around 2.50 cents per pound. Western Markets Desert Southwest . A light volume of 2016-crop Arizona cotton for contract base quality color 31, leaf 3, and staple 35 was forward contracted at around 100 points off ICE December futures. The contracts were subject to government discounts with a premium paid for qualities better than the contract base quality. San Joaquin Valley . No trading activity was reported. American Pima . A moderate volume of 2016-crop cotton color 2, leaf 2, and staple 46 was forward contracted for around 140.00 cents per pound, UD free, FOB warehouse. . A light volume of 2016-crop cotton color 2, leaf 3, and staple 46 was sold to domestic mills for July through September 2017 delivery. Source: USDA, AMS, Cotton and Tobacco Program Source: USDA, AMS, Cotton and Tobacco Program Source: USDA, AMS, Cotton and Tobacco Program Number of Bales in Certificated Stocks Source: USDA, AMS and ICE U. S. Futures Delivery Points Stocks as of 9-22-2016 Awaiting Review Non-Rain Grown Cotton Dallas/FT. Worth, TX 8,059 90 0 Galveston, TX 509 0 0 Greenville, SC 172 0 0 Houston, TX 301 0 0 Memphis, TN 22,123 0 0 Total 31,164 90 0 Contact Information Division Director Barbara.Meredith@ams.usda.gov (901) 384-3016 Barbara Meredith Deputy Division Director Cathy.Greene@ams.usda.gov (901) 384-3016 Cathy L. Greene Southeastern Area Reporter Danny.Pino@ams.usda.gov (478) 752-3560 Danny Pino Jr. South Central Area Reporter Jeff.Carnahan@ams.usda.gov (901) 384-3016 Jeff Carnahan Southwestern Area Reporter Jane.Byers-Angle@ams.usda.gov (806) 472-7635 Jane Byers-Angle Western Area Reporter Maria.Townsend@ams.usda.gov (559) 651-3019 Maria Townsend National Reporter Veronica.Williamson@ams.usda.gov (843) 667-4381 Veronica Williamson The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal or because all or part of an individual’s income is derived from any public assistance program (not all prohibited bases apply to all programs). 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