Cotton Prices up as Sowing of Cotton May Be Delayed in India

US Cotton #2 Futures yesterday settled up by 0.51% at 23710 as the sowing of cotton may be delayed in India as the southwest monsoon, is set to reach the mainland two days later than usual. Cotton Cooperation of India has increased prices by 200-500 Rs Candy across all growths of all Zones for 2020-21 season and for 2019-20 season. The cotton crop is at risk due to water shortage in Sindh and Punjab. The increasing trend in the rate of cotton remained continued in international markets. Agriculture Minister Punjab Hussain Jahanian Gardezi said that Punjab is facing a water shortage of 22 % while Sindh is facing a shortage of around 17%. According to the Third Advance Estimate released by the government, cotton production is estimated at 36.49 million bales higher by 4.59 million bales than the average cotton production. In the previous season, 2019-20 cotton production was estimated at 36.07 million bales.
  
The U.S. Department of Agriculture's (USDA) weekly export sales report showed net sales of 171,200 Running Bales for the 2020/2021 marking year, 59% higher than the prior week. CAI has revised higher Indian cotton export estimates for the 2020-21 season at 65 lakh bales against 60 lakh bales projected till last month. Cotton production in Haryana is expected to decline by 27 percent to 1.8 million bales in the 2020-21 (July-June) season due to yield loss. In the spot market, Cotton gained by 150 Rupees to end at 23500 Rupees.
  
Technically market is under short covering as the market has witnessed a drop in open interest by -1.58% to settled at 7268 while prices up 120 rupees, now Cotton is getting support at 23490 and below same could see a test of 23260 levels, and resistance is now likely to be seen at 23860, a move above could see prices testing 24000.
  
Trading Ideas: 
# Cotton trading range for the day is 23260-24000.
# Cotton gains as the sowing of cotton may be delayed in India as the southwest monsoon, is set to reach the mainland two days later than usual
# The country’s cotton exports are likely to be 20 percent higher at 1.02 million tonnes in 2020-21.
# Cotton crop is at risk due to water shortage in Sindh and Punjab.
# In the spot market, Cotton gained by 150 Rupees to end at 23500 Rupees.