Market Movement from 01st Apr 2024 to 06th Apr 2024.

•  
• There was a bloodbath in the NY future, with increasing certified stocks experiencing a speculators liquidation. This long liquidation of spec positions converted continuing downward sentiment.
• NY May cotton futures experienced a notable decline, dropping from 91.38 cents on March 28 to 86.25 cents on April 5, marking a week-on-week loss of 5.13 cents.
• In the latest U. S. Export Sales Report for the week ending 28-March-2024, U.S. cotton export sales for the 2023-2024 season showed net upland sales of 84,900 bales and upland shipments of 3,67,600 bales, along with net Pima sales of 1,400 bales and Pima shipments of 5,200 bales, totaling 86,300 bales. Looking ahead to the 2024-2025 season, there were net upland sales of 22,900 bales and no net Pima sales reported, resulting in a total of 22,900 bales for the week. The export rate is surpassing the weekly required average in order to meet the target set by the USDA.
• In the Indian physical market, rates are not aligning consecutively with the NY futures, yet sentiment is turning bearish.
• This week, the Gujcot Spot Rate for cotton exhibited a fluctuating trend with minor fluctuations observed throughout the weekdays. Starting at 60,750 on Monday, it rose slightly to 61,000 on Tuesday before experiencing a slight decline to 60,800 on Wednesday. However, the rate dipped further to 60,500 on Thursday and 60,350 on Friday, marking a downward trend. The slight decrease continued as the rate settled at 60,250 on Saturday, reflecting a relatively stable but marginally declining market sentiment over the course of the week.
• With a free fall in NY futures and steady Indian rates, it provides an opportunity for basis players to offload their long positions with a higher basis. Significant trading for forward delivery occurred during this week.
• Indian arrivals are currently limited, and the available cotton quality is also not suitable, resulting in a slowdown in ginning activities. The nationwide arrival was approximately between 50,000 to 60,000 bales, with Gujarat contributing nearly 22,000 bales per day.
• The Indian basis is currently too high, posing a challenge for Indian mills to compete with their rivals. The basis has consistently remained positive between 0.15 to 6.17.
• In the upcoming week, NY futures could potentially be a game changer, especially with limited sessions remaining before May settlement. Despite high open interest, Indian arrivals are expected to slow down, resulting in Indian rates being less affected by bearish sentiment.
• This week witnessed a subtle fluctuation in the USD-INR Exchange Rate, with marginal changes observed on a daily basis. Beginning at 83.40 on Monday, the rate remained relatively stable, with a minor decrease to 83.38 on Tuesday. However, Wednesday saw a slight increase to 83.43, maintaining this rate through Thursday. Towards the end of the week, the exchange rate experienced a minor drop, settling at 83.29 on Friday. Overall, the week reflected a modest variation in the exchange rate, suggesting a balanced market sentiment amidst prevailing economic conditions.
• Hoping for a better week ahead.