We are picking up the pace of harvest. The Lubbock classing office has graded another 122,328 bales since my report last Friday. Daily receipts topped 30,000 bales Wednesday. Lamesa added another 40,649 bales as well. Lubbock has an average staple of 36.94 so far this week with strength of 29.91 and the predominant color of 31, leaf 3 and 4. The average staple at Lamesa has been 36.35 for the week with the predominant color of 21 and 31, leaf 3 and strength of 29.4. The part of the grade, which concerns me most right now, is leaf, micronaire and bark. Micronaire has declined each week since we started and bark has increased. Average micronaire at Lubbock so far this week has been 3.85 with Thursday's 27,638 bales running 3.74. The same weakness in quality can be seen looking at the percent of bales containing bark, which was 21.4% for the week and 32.2% for the day. Compare that to last year at this same time when the average grade was color 21, leaf 2, staple 35.8, mike 4.3, strength 29.0 and only 3.4% bark. Staple and strength are the only things holding up to last year's standard. We are also well behind last year's bale count, which was over 600,000 bales compare to the current season's 155,929.
Weather, except for Wednesday's high winds, has been somewhat favorable. Most cotton that was sprayed before the big freeze is now in the process of being harvested. If we don't get some hard freezing weather soon, we may have a break in the action while we wait for the crop to dry down some more.
Export sales rebounded somewhat this week with China leading the way with a net of 47,000 running bales of new sales. There were no new sales of Pima this week, but net upland sales were back up to 241,500 running bales. Shipments dropped back below the necessary 240,000 bales to only 192,300. Again, China was the leading destination at 62,100. Hopefully, that means last week's cancellations by China were just to get more favorable price terms on cotton still to be shipped.
The latest USDA estimate of world supply and demand comes out Monday, November 10th. I believe that the current pace of exports will justify keeping exports the same this month after last month's big drop. Surely they will lower the crop size for Texas this month. Early harvest results on the High Plains indicate there is no way the crop will be 3.57 million bales and classing data from the Corpus Christi Classing Office shows only 525,000 bales from the region expected to make 630,000 bales in the last estimate. The final Texas number could easily be one-half million bales short of last month's 5.3 million forecast.
Well, I have avoided it as long as I can, but I guess I have to talk about price somewhere in this post. The December 2008 futures contract at the ICE lost 222 points this week, setting a new life-of-contract low of 4200 today. Forty-two cents is important because that is the lowest price we have seen on the nearby contract after rising from the depths of the 2001 marketing year when we reached 29 cents. If 42 cents does not hold as a low next week, I really don't have any idea how low this market can actually go. I remember 2001 very well. I started the year with over a thousand bales of cotton in storage and everyone said the market was headed back up. We lost over $50 per bale before we could unload them in the free fall.
For more information on cotton marketing be sure to check out Dr. John Robinson's weekly cotton marketing newsletter by clicking on Market Outlook under the Resources drop down list from the Extension Ag Eco website agecoext.tamu.edu. Also, to listen to recordings of the Ag Market Network conference calls, as well as weekly commentary from Mike Stevens, go to AgMarketNetwork.net. The next Ag Market Network conference call will be November 12th at 7:30 a.m.
That's your South Plains cotton update for Friday, November 7th. This is Jay Yates, Risk Management Specialist with the Texas AgriLife Extension Service. Remember to tune in every Thursday at 1:00 p.m. for the South Plains Cotton Market Update live on Ag Talk on Fox Talk 950.
