Quiet trading conditions dominated the cotton market this week as volumes dropped, ranges narrowed, and phones went silent. Cotton traders lamented that summertime conditions had truly descended upon the cotton market.

Unlike the past few seasons when the market worked on whittling down the excessive carryover during this period, this year there definitely is less cotton available for buyers. The situation could prove to be interesting for buyers with near-term needs as they are confronted with tight basis levels and limited offers. The cotton market now appears to be on the verge of entering what some call its “summer slumber.”

“Cotton futures prices on the Intercontinental Exchange (ICE) are treading water in a bullish atmosphere as the world economic recovery has sparked a rebound in textile demand,” an analyst said. “Cotton prices are up 62 percent from the same time last year as traders await the cotton harvest in the Northern Hemisphere. Currently, traders are selling the remnants of available supplies to textile mills who are trying to meet demand from retail- ers,” he explained.

Another market observer noted, “As we move forward, the market may again be pushed and pulled by outside forces, but the relatively tight carryover is likely to keep prices supported until new crop supplies are better known.” He continued, “Weather, of course, will be a factor from time to time. Despite the poor start in parts of China earlier this season and some limited heat stress in the U.S. at the moment, cotton crops appear to be in generally good condition globally.”

In the United States, 62 percent of the cotton crop was rated to be in good to excellent condition as of June 20. Beneficial rain in West Texas was traded off against drier conditions in the Delta and southeastern areas. Crop condition figures still remain at or near record highs. At 62 percent, the crop was better than the 10- and 20-year averages.

Meanwhile, for this late in the marketing year, this week’s export sales report from USDA was considered substantial. Net upland sales of 84,000 bales for delivery in 2009-10 were down 71 percent from the previous week and 75 percent from the fourweek average. China, Turkey, Bangladesh, and Thailand were primary buyers. Net sales of 172,200 bales for delivery in 2010-11 were mainly for Morocco, Malaysia, and Turkey.

“With less and less cotton available to sell, at some point it was inevitable that the sales figure would decline,” an analyst said. “You simply can’t sell that which no longer exists.”

Export shipments of 311,300 bales were up 20 percent from the previous week and 13 percent higher than the four-week average. Primary destinations were China, Turkey, and Mexico.

On the spot cotton market, growers in Texas, Oklahoma, and Kansas sold 292 bales online in the week ended June 24 compared to the previous week when only 9 bales were traded.

Traders now are looking ahead to the June 30 planted cotton acreage estimate from USDA. Planted acreage was estimated at 10.51 million acres on March 31, but most in the industry expect an increase in the June figure. The data will be the market’s first glance at concrete figures for the 2010-11 U.S. crop.