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Cotton

Cotton yesterday settled down by -0.79% at 46600 after USDA for 2022/23 raised its global production estimates. The 2022/23 world cotton balance sheet includes slightly higher production and slightly lower consumption projections compared with the previous month, and ending stocks are virtually unchanged. Global consumption is 450,000 bales lower, with the largest declines in Mexico, Bangladesh, and Vietnam. Beginning stocks for 2022/23 are also lower this month as a 1.5-million-bale decline in 2021/22 global production more than offsets a 1.25-million-bale decline in projected consumption. A 1.0- million-bale drop in India’s crop accounts for most of the production change, with lower yield expectations in Brazil accounting for the remainder. Consumption is projected 500,000 bales lower in both China and India, with smaller declines for Mexico and Vietnam. There were reports of 18 per cent less area under cotton sown than last year in Punjab. Despite the Punjab government setting a target to have 4 lakh hectares under cotton to reduce land under paddy, the state has witnessed an 18 per cent decrease from last year, when about 3.03 lakh hectares of the then targeted 3.25 lakh hectares were under cotton. Till now, cotton was sown on only 2.48 lakh hectares of land; the cotton sowing is almost over. In spot market, Cotton dropped by -620 Rupees to end at 47470 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by - 2.74% to settled at 2410 while prices down -370 rupees, now Cotton is getting support at 46340 and below same could see a test of 46090 levels, and resistance is now likely to be seen at 46800, a move above could see prices testing 47010.

Trading Idea for the day

Cotton trading range for the day is 46090-47010.

Cotton prices dropped after USDA for 2022/23 raised its global production estimates.

The 2022/23 world cotton balance sheet includes slightly higher production and slightly lower consumption projections

Consumption is projected 500,000 bales lower in both China and India, with smaller declines for Mexico and Vietnam.

Cocudakl

Cocudakl yesterday settled down by -1.43% at 2835 due to the price of other cattle feeds being lower than the price of cottonseed oilcake, all the consumers have created a mindset to shift towards other cattle feeds. Global cottonseed production is projected at 44.1 million tons, up 3 percent, with gains in China, India, Turkey, and Uzbekistan. Cottonseed exports are forecast down nearly 2 percent, while crush is projected to grow 3 percent. Cottonseed oil trade is forecast to decline on lower export projections for the United States due to higher domestic demand. The new season for cotton is expected to be good. Retailer expects slight decline in dairy demand as supply uncertainties remain. Further pressure seen as Dairy farmers have demanded a hike in milk price in the midst of rising production cost, and the government has convened a meeting of farmers and farmers’ representatives in Thiruvananthapuram on May 10. Milk procurement prices have been rising, prompting higher revenues for dairy companies but also leading to pressure on margins in FY2023-24, according to a report. The new season for cotton is expected to be good for farmers as the market price of the fiber is currently more than MSP. Pressure seen in cotton also amid expectations of higher supply from the US and lower global demand. In Akola spot market, Cocudakl gained by 1.5 Rupees to end at 3063.25 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 8.43% to settled at 81700 while prices down -41 rupees, now Cocudakl is getting support at 2816 and below same could see a test of 2797 levels, and resistance is now likely to be seen at 2866, a move above could see prices testing 2897.

Trading Idea for the day

Cocudakl trading range for the day is 2797-2897.

Cocudakl prices dropped as the price of other cattle feeds being lower, all the consumers have created a mindset to shift

Global cottonseed production is projected at 44.1 million tons, up 3 percent

Cottonseed exports are forecast down nearly 2 percent, while crush is projected to grow 3 percent.

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