Cotton trading range for the day is 23290-24590 - Kedia Advisory
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Cotton
Cotton yesterday settled down by -1.16% at 23940 as USDA kept the production estimate unchanged but hiked its projections for U.S. 2021/22 exports, cut ending stocks. Cotton sowing area grows despite of delays. Despite sowing of cotton stretching beyond the ideal sowing time in Punjab, it is close to reaching the target for 2021-22. The state agriculture department had the target of sowing cotton on 3.25 lakh hectares the crop had been sown over 3.01 lakh hectares. New figures show global cotton stock levels are set to increase to 22m tonnes by the end of 2020/21 as the stocks-to-use ratio declines. According to the latest update from the International Cotton Advisory Committee (ICAC), China’s stocks, however, are expected to decline as the rest of the world’s expands slightly. Cotton consumption is expected to increase by 2% to 25.3m tonnes as the global economy continues to recover. Decreases in Brazil, India and the US have caused a reduction in the 2020/21 global production estimate but cotton production — along with consumption and trade — are all expected to increase in 2021/22: Production is expected to increase by 5% to 25.5m tonnes, with increases in planted areas in the US and West Africa. In spot market, Cotton gained by 10 Rupees to end at 24470 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -5.33% to settled at 4477 while prices down -280 rupees, now Cotton is getting support at 23610 and below same could see a test of 23290 levels, and resistance is now likely to be seen at 24260, a move above could see prices testing 24590.
Trading Idea for the day
Cotton trading range for the day is 23290-24590
Cotton dropped as USDA kept the production estimate unchanged but hiked its projections for U.S. 2021/22 exports, cut ending stocks.
Cotton stock levels are set to increase to 22m tonnes by the end of 2020/21
According to the latest update from the ICAC, China’s stocks, however, are expected to decline as the rest of the world’s expands slightly.
Cocudakl
Cocudakl yesterday settled down by -1.12% at 2910 on profit booking after prices seen supported as Cottonseed production and quality were affected last year due to excessive rains in the key producing State of Telangana and some parts of Tamil Nadu. Support also seen amid prospects of higher exports and falling supply in the physical market. However there were worries of lockdown it is anticipated that there will be slow supply and same with demand. 2021/22 global cottonseed production is projected at nearly 44 million tons, up 5 percent from the current year. Higher forecasts for the United States, Brazil, Australia, and Mali are partially offset by declines in China. U.S. production is forecast up 781,000 tons to nearly 5 million. Waning arrivals of raw cotton due to the fag end of the season and limited stocks of cottonseed with ginners has led to a supply crunch in the market. India has produced around 36 mln bales in the ongoing 2020-21 (Oct-Sep) season, of which nearly 33 mln bales, or 92% of the stock, has already arrived in the market. Considering firm demand outlook for the commodity, the tight supply situation in cottonseed is expected to continue in the coming months as well as the new season for cotton will start only in October. In Akola spot market, Cocudakl dropped by -31.8 Rupees to end at 2919.6 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 2.99% to settled at 76550 while prices down -33 rupees, now Cocudakl is getting support at 2872 and below same could see a test of 2833 levels, and resistance is now likely to be seen at 2948, a move above could see prices testing 2985
Trading Idea for the day
Cocudakl trading range for the day is 2833-2985
Cocudakl dropped on profit booking after prices remained supported as Cottonseed production and quality were affected
However there were worries of lockdown it is anticipated that there will be slow supply and same with demand.
2021/22 global cottonseed production is projected at nearly 44 million tons, up 5 percent from the current year.
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