December Cotton Futures Closed Down For The Week

DR. AARON SMITH

KNOXVILLE, TENNESSEE

December corn futures prices increased 17 cents this week, closing at $4.18. Prices are approaching a key level of resistance near $4.25. If prices can breach, and maintain prices, beyond $4.25, the next major area of price resistance is $4.60. Similar to corn, soybean futures prices increased this week and are approaching key resistance at $10.80. If prices are able to push above $10.80, an increase to $11.00 is likely. Concerns over crop damage from Helene and a dry start to the Brazilian planting season were the primary factors leading to improved prices for corn and soybeans this week. 

After back-to-back weeks of price gains, December cotton futures closed down for the week. Over the three-week period, prices moved from 68 cents to over 74 cents before falling back under 73 cents to close this week at 72.72 cents. Prices were not able to hold above 74 cents, however given recent adjustments to world cotton supplies by the USDA, it seems likely that prices will move higher later this year or early 2025. Prices above 80 cents still remain unlikely based on chronic demand concerns. 

Since early September, July wheat futures have established a trading range between $6.00 and $6.30. 50% of the US winter wheat crop is estimated to be in drought, up 3% compared to the same week last year. Precipitation from hurricane Helene is focused on the Southeast and Eastern corn belt and will do little to improve conditions in the southern plains. 

On Monday September 30 the USDA will release its quarterly Grain Stocks report. The report will give estimates on the amount of corn and soybeans carried over from the 2023/24 marketing year into the current marketing year. Additionally, the report provides estimates of on-farm and off-farm storage. Currently, the USDA estimates soybean ending stocks at 340 million bushels and corn ending stocks at 1.812 billion bushels for the 2023/24 marketing year. For the 2024/25 marketing year soybean and corn ending stocks are projected to increase to 550 million bushels and 2.057 billion bushels, respectively. Markets will react to any changes in the USDA estimates. 

Corn

Across Tennessee, average corn basis (cash price-nearby futures price) strengthened or remained unchanged at Northwest, North-Central, and Mississippi River elevators and barge points and weakened at West and West-Central elevators and barge points. Overall, basis for the week ranged from 40 under to 14 under, with an average of 30 under the December futures at elevators and barge points. Ethanol production for the week ending September 20 was 0.994 million barrels per day, down 55,000 from the previous week. Ethanol stocks were 23.524 million barrels, down 0.261 million barrels compared to last week. Corn net sales reported by exporters for September 13-19 were net sales of 21.1 million bushels for the 2024/25 marketing year. Exports for the same period were up 93% compared to last week at 43.5 million bushels. Corn export sales and commitments were 25% of the USDA estimated total annual exports for the 2024/25 marketing year (September 1 to August 31) compared to the previous 5-year average of 31%. The Crop Progress report estimated corn condition at 65% good-to-excellent and 12% poor-to-very poor; corn dented at 92% compared to 85% last week, 94% last year, and a 5-year average of 91%; corn mature at 61% compared to 45% last week, 65% last year, and a 5-year average of 55%; and corn harvested at 14% compared to 9% last week, 13% last year, and a 5-year average of 11%. In Tennessee, corn condition was estimated at 44% good-to-excellent and 24% poor-to-very poor; corn dented at 99% compared to 97% last week, 98% last year, and a 5-year average of 98%; corn mature at 92% compared to 85% last week, 88% last year, and a 5-year average of 86%; and corn harvested at 58% compared to 46% last week, 40% last year, and a 5-year average of 40%. Cash prices ranged from $3.71 to $4.02 at elevators and barge points. December 2024 corn futures closed at $4.18, up 17 cents since last Friday. For the week December 2024 corn futures traded between $4.01 and $4.19. Downside price protection could be obtained by purchasing a $4.20 December 2024 Put Option costing 12 cents establishing a $4.08 futures floor. 

Dec/Mar and Dec/Dec future spreads were 26 and 34 cents. March 2025 corn futures closed at $4.44, up 24 cents since last Friday. December 2025 corn futures closed at $4.52, up 10 cents since last Friday. 

Soybeans

Across Tennessee the average soybean basis strengthened or remained unchanged at Northwest and West elevators and barge points and weakened at North-Central, West-Central, and Mississippi River elevators and barge points. Basis ranged from 65 under to 25 under the November futures contract, with an average basis at the end of the week of 44 under. Soybean net weekly sales reported by exporters were net sales of 57.9 million bushels for the 2024/25 marketing year. Exports for the same period were up 16% compared to last week at 19.0 million bushels. Soybean export sales and commitments were 35% of the USDA estimated total annual exports for the 2024/25 marketing year (September 1 to August 31), compared to the previous 5- year average of 44%. The Crop Progress report estimated soybean condition at 64% good-to-excellent and 11% poor-to-very poor; soybeans dropping leaves at 65% compared to 44% last week, 68% last year, and a 5-year average of 57%; and soybeans harvested at 13% compared to 6% last week, 10% last year, and a 5-year average of 8%. In Tennessee, soybean condition was estimated at 46% good-to-excellent and 20% poor-to-very poor; soybeans dropping leaves at 70% compared to 58% last week, 57% last year, and a 5-year average of 50%; and soybeans harvested at 32% compared to 22% last week, 15% last year, and a 5- year average of 12%. Cash soybean prices at elevators and barge points ranged from $9.74 to $10.60. November 2024 soybean futures closed at $10.65, up 53 cents since last Friday. For the week, November 2024 soybean futures traded between $10.12 and $10.69. November/December 2024 soybean-to-corn price ratio was 2.55 at the end of the week. Downside price protection could be achieved by purchasing a $10.70 November 2024 Put Option which would cost 27 cents and set a $10.43 futures floor. 

Nov/Jan and Nov/Nov future spreads were 18 and 35 cents. January 2025 soybean futures closed at $10.83, up 54 cents since last Friday. November 2025 soybean futures closed at $11.00, up 40 cents since last Friday. Nov/Dec 2025 soybean-to-corn price ratio was 2.43 at the end of the week. 

Cotton

North Delta upland cotton spot price quotes for September 26 were 66.52 cents/lb (41-4-34) and 68.52 cents/lb (31-3-35). Adjusted World Price (AWP) increased 2.23 cents to 61.06 cents. Cotton net weekly sales reported by exporters were net sales of 87,800 bales for the 2024/25 marketing year. Exports for the same period were down 39% compared to last week at 79,500 bales. Upland cotton export sales were 45% of the USDA estimated total annual exports for the 2024/25 marketing year (August 1 to July 31), compared to the previous 5-year average of 56%. The Crop Progress report estimated cotton condition at 37% good-to-excellent and 33% poor-to-very poor; cotton bolls opening at 63% compared to 54% last week, 62% last year, and a 5-year average of 60%; and cotton harvested at 14% compared to 10% last week, 12% last year, and a 5-year average of 12%. In Tennessee, cotton condition was estimated at 56% good-to-excellent and 12% poor-to-very poor; cotton bolls opening at 78% compared to 67% last week, 58% last year, and a 5-year average of 53%; and cotton harvested at 3% compared to 1% last week, 3% last year, and a 5-year average of 2%. December 2024 cotton futures closed at 72.72 cents, down 0.8 cents since last Friday. For the week, December 2024 cotton futures traded between 71.68 and 74.55 cents. Downside price protection could be obtained by purchasing a 73 cent December 2024 Put Option costing 2.49 cents establishing a 70.51 cent futures floor. 

Dec/Mar and Dec/May cotton futures spreads were 1.80 cents and 2.89 cents. March 2025 cotton futures closed at 74.52 cents, down 0.62 cents since last Friday. May 2025 cotton futures closed at 75.61 cents, down 0.55 cents since last Friday. 

Wheat 

Wheat net weekly sales reported by exporters were net sales of 5.8 million bushels for the 2024/25 marketing year – a marketing year low - and 0.4 million bushels for the 2025/26 marketing year. Exports for the same period were up 11% compared to last week at 26.1 million bushels – a marketing year high. Wheat export sales were 50% of the USDA estimated total annual exports for the 2024/25 marketing year (June 1 to May 31), compared to the previous 5-year average of 54%. Wheat cash prices at elevators and barge points ranged from $5.13 to $5.50. December 2024 wheat futures closed at $5.80, up 12 cents since last Friday. The December wheat-to-corn price ratio was 1.39. December 2024 wheat futures traded between $5.69 and $5.96 this week. March 2025 wheat futures closed at $6.00, up 13 cents since last Friday. 

Dec/Mar and Dec/Jul future spreads were 20 and 36 cents. The Crop Progress report estimated winter wheat planted at 25% compared to 14% last week, 23% last year, and a 5-year average of 24%; winter wheat emerged at 4% compared to 6% last year and a 5-year average of 5%; and spring wheat harvested at 96% compared to 92% last week, 95% last year, and a 5-year average of 95%. In Tennessee winter wheat planted was estimated at 4% compared to 0% last week, 3% last year, and a 5-year average of 6%. July cash contracts at elevators and barge points ranged from $5.76 to $5.98. July 2025 wheat futures closed at $6.16, up 13 cents since last Friday. Downside price protection could be obtained by purchasing a $6.20 July 2025 Put Option costing 55 cents establishing a $5.65 futures floor.   ∆

DR. AARON SMITH: University of Tennessee