NEW YORK (Dow Jones)--Cotton prices fell to their lowest levels in two weeks
Tuesday in sympathy with broad-based commodities losses triggered by the
surging dollar.
Nearby cotton for May delivery ended 2.27 cents, or 3%, lower at 79.59 cents
a pound. Most-active July cotton settled 1.94 cent, or 2%, lower at 81.29 cents
a pound, off the 81.19 low.
The commodities complex dropped as the dollar rallied Tuesday on uncertainty
that Greece's debt package would successfully stem euro-zone economic concerns.
Metals, crude and most softs ended the session lower along with cotton Tuesday.
Cotton had additional weakness during the session as prices continue to slide
away from highs amid signs of relaxing demand. Overall, prices have drifted
back 6.5% from two-year highs hit April 26 on news of an export ban from India,
the world's No. 2 cotton producer.
Cotton demand appears to be suffering from a surge in cash prices, driven by
panic buying following India's export ban, said Sharon Johnson, senior cotton
analyst at First Capitol Group in Atlanta.
Speculative fund sales kicked in as July futures busted through pre-set chart
indicators at technical support levels, particularly at 83 cents basis July.
"Cotton never had a chance between the crumbling technicals and outide
markets," said Mike Stevens, an independent cotton broker and analyst based in
Mandeville, La.
The next support level for July is 81-81.10, said Boyd Cruel, senior softs
analyst at Vision Financial Markets in Chicago.
ICE daily cotton stocks increased by 1,267 500-pound bales Monday to total
1.021 million, with 39,697 bales awaiting review and 37 decertification orders,
according to exchange data.
ICE cotton open interest--the number of active positions left at the end of
the session--decreased by 1,936 positions Monday to total 188,069, according to
the exchange.
Volume was estimated 23,930 lots. In options, approximately 4,338 calls and
4,423 puts traded, according to exchange data.
Close Change Range
May 79.59 -2.27c 79.59-82.19
Jly 81.29 -1.94c 81.19-83.51
Dec 77.08 -0.81c 76.75-78.00