REUTERS: Cotton hits near 3-month low on speculator selling, strong dollar

REUTERS: Cotton hits near 3-month low on speculator selling, strong dollar

April 12 (Reuters) -ICE cotton futures fell to a near three-month low on Friday and were set for their sixth straight week of declines, pressured by speculative selling and a robust U.S. dollar.

* Cotton contract for May CTc1 fell 0.65 cent, or 0.78%, at 82.72 cents per lb by 12:39 p.m. ET (1639 GMT), after hitting their lowest since Jan. 18.

* The contract was en route for its sixth straight weekly decline.

* Speculators continue to liquidate out of the market... there is a technical pattern on the chart which is typically bearish and we've been down for last nine of the 10 days, said Keith Brown, principal at cotton broker Keith Brown and Co. in Georgia.

* The dollar index .DXY rose about 0.7% jumping to its highest since early November earlier in the session, making the natural fibre more expensive for overseas buyers.

* The U.S. Department of Agriculture's (USDA) weekly export sales report 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

* According to the World Agricultural Supply and Demand Estimates (WASDE) report on Thursday, world trade for 2023/24 was projected 700,000 bales higher this month to nearly 44 million.

* Limiting losses, oil rose 2% as tension in the Middle East raised the risk of supply disruptions. Higher oil prices make cotton-substitute polyester more expensive.

* Elsewhere in the grains market, Chicago corn, wheat and soybean futures edged up as markets assessed a U.S. government crop report that added uncertainty about South American harvest prospects. GRA/

Reporting by Daksh Grover in Bengaluru; Editing by Vijay Kishore


Source: Reuters
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