Extension expert advises cotton producers to follow fundamentals

Cotton

Despite recent news headlines, the fundamentals of supply and demand is a good compass for forecasting future cotton prices.

October 29, 2013

1 Min Read

<p> Cotton farmers who do decide to plant cotton need to think about forward pricing or hedging because the risk will continue to be to the downside, according to Dr. John Robinson, Texas A&M AgriLife Extension Service cotton economist.</p>

Stick to the basics when deciding on cotton marketing actions.

That’s the advice of a Texas A&M AgriLife Extension Service cotton economist for growers looking ahead to future prices. Dr. John Robinson, College Station, made that recommendation on the recent Ag Market monthly conference call and said despite recent news headlines, the fundamentals of supply and demand is a good compass for forecasting future prices.

“I expect this year’s December and next year’s (Dec. ‘14) harvest time futures contracts to continue to trade in their current ranges,” Robinson said. “I want to point out the current spread of December 2014 is about a nickel below December 2013, which implies there is already an expectation of a Chinese unwinding some of their stocks.”

Learn more about cotton marketing actions.