July 6, 2018

China cotton futures fall nearly 3 pct ahead of trade tariffs

BEIJING, July 5 (Reuters) -

* Chinese cotton futures fell nearly 3 percent in early trade on Thursday, amid fears that a protracted trade dispute between the world’s top two economies could affect China’s textile exports.

* The most actively traded cotton contract on the Zhengzhou Commodity Exchange touched 16,045 yuan ($2,418) per tonne, the lowest level in three months. It was trading down 1.9 percent at 16,270 yuan ($2,451) per tonne at 0200 GMT.

* Futures rallied in early May as investors piled into the market amid worries over supplies

* Those gains have been eroded in recent weeks, and investors continued to exit the market a day before United States’ tariffs on $34 billion worth of Chinese goods are set to kick in

* Concerns are growing that the trade dispute could affect textile exports from China, the world’s top exporter, said Chen Jing, analyst at Citic Futures in Beijing

* Chinese currency and equity markets have also been volatile ahead of July 6, with the yuan recording its worst month on record in June, losing about 3.3 percent of its value against the greenback. ($1 = 6.6354 Chinese yuan renminbi) (Reporting by Dominique Patton; editing by Richard Pullin)

Source: Reuters

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