US cotton output expected to rise weighing on ICE cotton futures

Currently, the favorable weather in US major cotton producing regions, harvests progress and good-to-excellent ratio indicate that the production and quality will be good this season, while in the meantime, US cotton export sales keep weak, and some market shares are squeezed by the Brazilian cotton. From the prospective of US cotton supply and demand, ICE cotton futures market faces large pressure.

1. US cotton production is expected to rise
According to USDA’s projection in Oct, US cotton production is expected to rise by 18% from 2018/19 season to 4.73 million tons in 2019/20 season. Harvest areas may rise by 23% to 12.509 million acres, and yield may inch down by 3% to 839 pound per acre. According to the growing development, weather condition and harvest progress, its production and quality may be good this season.