With cheaper U.S. cotton available, coupled with the volume of import quotas still held by Chinese mills, they will remain big buyers. Most likely they will not want to let the quotas go unused. Next week's export sales report should match this week's. With New York trading below 60 cents, mills will continue to buy in volume.
Yet, the impending upward movement in price will be held in check until more is known about the Northern Hemisphere crop. Certificated stocks remain near 700,000 bales and demand, strong as it appears for now, is likely not enough to significantly reduce this level prior to the harvest of the 2007 crop.
The market creeps higher into the low 60's, but the emphasis is on "creeps."
marketing@alchempro.com
