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Re: cotton news/ronnie/Nic
In Response To: Re: cotton news ()

I was curious, read the article ronnie posted.
I deleted the original post since I made an error.

Article talked in terms of "bales", I had no clue as the CT contract is for
50,000 lbs. Looking, I found another article with more detail. Link here:


Still don't know what a bale weighs ?? Or how many per futures contract.

BUTTTTTTTTTTT, The article discusses the CTH11 (march) and FND is 2/22/11 not
very far off.

Now, unless I'm very groggy right now, or being really stupid, it looks like
some serious "unwinding" of March futures contracts has to occur over the next 3
weeks if there is any truth at all to the numbers. 8.6 mil. bales being traded
(bought/sold) and only 200,000 exist ??

Currently the OI on the March Contract is 85,629 total of longs = shorts.

If a bale is 100 lbs. then there are 500 bales to a 50,000 lb. futures contract.
Then 8.6 million bales would require 17200 contracts to
cover this number. The 200,000 bales expected to exist to satisfy the expected
market deliverable needs is 400 contracts.

So, with an OI of 85,629 contracts
something is not "computing" for me to arrive at the numbers in the article.

In any event, it sure seems that some serious "unwinding" of these positions has
to occur !!!!!

Please let me know if I have screwed up here !!! I went trough this because the
numbers in the articles really caught my imagination !!!

Thanks, Lee

Messages In This Thread

Re: cotton news/ronnie/Nic