Return
to TFB Main Page
Return
to Texas Agriculture Archive
June 1, 2001
MARKETING
By Bryce Myrick
Director, TFB Agricultural Marketing Education
Where Are Cotton Prices Headed? USDA has projected that U.S. producers will plant 15.6 million acres, but Memphis-based Sparks and Company has projected 16.2 million acres. Sparks' estimate has the potential of a 19 million bale crop. Weak U.S. domestic mill use and the strong dollar are also major problems for cotton prices.
With all the negative news for cotton prices, will prices continue to stay low? Right now there seems to be no adverse weather built into these prices. Also, low prices will cure low prices. When traders think we are near bottom, that is when the market will go up. This usually happens when producers are ready to give up. If prices stay low this fall, many countries will shift 2002 cotton acres to corn and wheat.
At the present time, there is a 13-15 cents LDP. Our goal should be to protect our LDP. If you need a strategy for LDP protection, give me a call.
To set up workshops or for help with your hedging needs, call 254-751-2242 or 915-698-0355 or e-mail: bbmyrick@swconnect.com.
OCTOBER CATTLE-FEEDER
Fundamentals:
Inaccurate reporting by USDA caused producers to lose money
Technical Analysis: Trend—Short-term Up; Resistance—None;
Support—88.00
DECEMBER - COTTON
Fundamentals:
Big Crop—Low Use.
Technical Analysis: Trend—Down; Resistance—51.00;
Support—None
SEPTEMBER - SOYBEANS
Fundamentals:
Record Brazilian crop
Technical Analysis: Trend—Down; Resistance—4.35;
Support—4.20
JULY KC - WHEAT
Fundamentals:
Poor U.S. crop—Low carryover
Technical Analysis: Trend—Sideways; Resistance—3.39;
Support 3.21
