Merchants/buyers, if not already, will be switching from December to March futures very soon (will be buying cotton basis the March futures rather than December).

The current Southeast basis is around -175 December futures. The spread between December and March is currently about 100 points, so the basis is likely to go to around -250 to -275 March.

Prices (Mar14 futures) bottomed out at 78.03 Nov. 5. The market attempted to recover. Mar15 rallied to 79.19 cents the next day on Nov.r 6 but then closed down 3 straight days.

Prices have simply not been able to find any traction, and pessimism in the market seems to be growing. Any reversal (improvement) will depend, in part, on good export news, and downward adjustments in World production and supply.

A continued downtrend could take us to the 75-cent area. Any improvement is likely going to be hard-pressed to break the 82-cent area given the supply/demand conditions as we now know them. The market is also increasingly nervous over China’s stocks policy. Reports suggest that China may start to auction off some of its massive stocks.

There were no October estimates due to the government shut-down. The production and supply/demand estimates for November where much anticipated, therefore, but turned out to be pretty much a non-factor with one exception.

World ending stocks were raised almost 1 million bales but this was due primarily to revisions carried forward from the 2011 and 2012 crop years. As far as 2013 numbers go, the U.S. crop was increased as expected. China production and ending stocks were lowered by half a million bales.