Cotton Carryover To Double Next Year
By J. Karl Rudy, Technical Editor
ell, cotton has done it again! Yet another season low was set on July 12 at 47.21 cents a pound.
That is the average base price of all markets and is the lowest base price since October 1992.
A respondent to the Yarn Market said: “It (the low cotton fiber price) appears to be caused by the world price situation. The adjusted world price for mid-July was 38.56 cents per pound. There is no strength anywhere, and no one expects an improvement. There will be a 3.6-million bale carryover this year with a projected increase to 6 million next year.”
In addition to this, reports indicate that the current crop is looking good everywhere. Barring a major catastrophe, it looks like there will be plenty of cotton, so pricing will probably remain low as most folks in the trade expect.
A spinner, in response to this situation, commented: “If prices will firm up and hold, and we can get some of that low priced cotton, we might actually turn a profit this year.”
Actually most spinners, while delighted with the continuing downward spiral of cotton price, feel sorry for the farmer. They empathize with a person who has to buy new equipment to stay competitive but deals in a market where pricing is such that he can’t make enough money to do it.