Cotton Market Tests Resistance Ahead of Friday’s September WASDE

Overnight, the cotton market was up and is trying to test-out overhead resistance. Also, traders are likely squaring certain positions ahead of Friday’s September WASDE.

Thursday at 8:30 a.m., the Labor Department will release its PPI (a measure of wholesale costs of goods and services). It is forecasted to show a rise of supplier-level goods of 0.4%.

Supplementing Thursday’s PPI will be Friday’s CPI (consumer inflation) report. Depending on these two data points, coupled with the recent stout August jobs report, traders could think that the Federal Reserve may indeed hike interest rates. The Federal Open Market Committee meets next week from Sept. 15-16.

A fresh round of export sales will be published Friday, delayed by the earlier observance of the Labor Day holiday. Last report revealed a sales number of 27,525 bales for the 2026/2027 marketing year. That amount was the lowest since the big cancellations at the end of the 2023/24 marketing year.

Then at noon EDT Friday, USDA will release its monthly supply-demand update. For that report, the average trade guess calls for U.S. 2026/27 production to be 13.19 million bales, down from the previous 13.61 million bales. Exports are expected to be at 12.14 million bales, versus 12.30 million bales seen in August. Domestic stocks are expected at 3.79 million bales versus the prior number of 4.00 million bales. If realized, that would be the lowest ending stocks number since 2023/2024 season with 3.15 million bales.

Lastly on Friday, at 3:30 p.m. EDT, the CFTC will update its Commitments of Traders numbers. The last report had the managed-money funds as net-buyers of 12,000 positions. Their action swelled the overall long carry to 107,936 contracts. Their record carry was 108,788 contracts.

For Thursday, close-in support for December cotton stands at 86.00 cents and 85.50 cents, with resistance around 89.00 cents and 89.65 cents. Thursday morning’s estimated volume is 15,787 contracts.

Keith Brown can be reached at commodityconsults@gmail.com or by calling (229) 890-7780.