REUTERS: Cotton edges up from 3-month lows on speculative buying

REUTERS: Cotton edges up from 3-month lows on speculative buying

April 15 (Reuters) -ICE cotton recovered on Monday, buoyed by speculative buying after prices touched a near three-month low in the previous session, while a strong U.S. dollar capped the natural fiber's gains.

* Cotton contract for May CTc1 rose 0.5 cent, or 0.6%, to 83.12 cents per lb by 11:30 a.m. ET (1530 GMT)

* The speculators are buying cotton after it dipped to three month lows. It's probably getting oversold and we're seeing some short covering as well, said Jack Scoville, vice president at Chicago-based Price Futures Group.

* On Friday, cotton prices hit their lowest since Jan. 18.

* "There's still plenty of cotton out there and there's still some severe demand questions. Demand really hasn't been all that good for export and that's 90% of our of our demand base," Scoville added.

* The dollar index .DXY rose about 0.2%, making cotton more expensive for overseas buyers.

* The U.S. Department of Agriculture's (USDA) weekly export sales report on Thursday showed net sales of 81,500 running bales for 2023/2024, down 4% from the previous week, and 10% from the prior 4-week average. EXP/COT

* Limiting gains, oil prices drifted lower, with the market downplaying the risk of a broader regional conflagration after Iran's weekend attack on Israel. O/R

* Lower oil prices make polyester - a cotton substitute - less expensive

* Meanwhile in the grains market, Chicago wheat, corn and soybeans fell as global markets reacted calmly to Iran's drone attack on Israel and as a firmer dollar made U.S. exports more expensive for importers. GRA/

Reporting by Anjana Anil in Bengaluru; Editing by Shailesh Kuber


Source: Reuters
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