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Cotton

Observation

Cottoncandy closed 0.75% higher at 59,100 in response to the USDA's October WASDE report, which reduced U.S. cotton production in the 2023/24 season to 12.8 million bales, mainly due to lower yields in Texas. This announcement carried significant implications as the USDA projected that Brazil would surpass the U.S. in cotton production for the first time in history and come close to exceeding U.S. cotton exports for the first time since the 19th century. Meanwhile, Australia saw a surge in its cotton exports to China, with 61,319 metric tons valued at $130 million in August. This uptick was attributed to normalized trade relations between the two countries. In India, the Cotton Association of India (CAI) provided its final estimate for the 2022-23 cotton season, raising the production estimate to 31.8 million bales, up from its previous estimate of 31.1 million bales in July. This estimate is slightly higher than the government's third advance estimate of 34.3 million bales for the same season. For the upcoming 2023-24 cotton season, India anticipates a production of 330-340 lakh bales, beginning on October 1. Technically, the cotton market saw short covering, with open interest remaining unchanged at 108. Prices rose by 440 rupees, with support at 58,900 and the potential to test 58,700. On the upside, resistance is likely at 59,300, and a move above could push prices to 59,500.

BUY COTTONCANDY NOV @ 58900 SL 58600 TGT 59300-59500. MCX

COCUDAKL 

SELL COCUDAKL DEC @ 2840 SL 2880 TGT 2780-2740. NCDEX

KAPAS 

BUY KAPAS APR @ 1630 SL 1610 TGT 1650-1670. NCDEX