REUTERS: Cotton rises over 3pc

REUTERS: Cotton rises over 3pc

NEW YORK: ICE cotton futures gained over 3% on Thursday on an increase in weekly export sales, while traders turned their attention to a monthly US government supply and demand report due on Friday.

Cotton contracts for May rose 1.99 cent, or 2.5%, to 81.49 cents per lb by 12:45 p.m. EDT (1645 GMT), having risen as much as 3.1% earlier in the session. It traded within a range of 79.6 and 81.94 cents a lb.

The US Department of Agriculture’s (USDA) weekly export sales report showed net sales of 269,900 Running Bales (RB) for the 2020/2021 marketing year, noticeably above the previous week and 8% higher than the prior four-week average.

The report included exports of 371,700 RB, up 15% from the previous week.

“If you see more exports (going forward), which I think you will, it’s possible to have a carryover (figure) down around 3 million bales (in the current marketing year)- it’s going to tighten up the crop,” Sid Love, commodity trading adviser at Kansas-based Sid Love Consulting.

Cotton was also supported by hopes for a reduction to US ending stocks in the USDA’s World Supply and Demand Estimates (WASDE) report due at 12 p.m. EDT (1600 GMT) on Friday, Love added.

Further supporting cotton, the dollar eased 0.5%, making the commodity cheaper for buyers holding other currencies.

The natural fibre also tracked gains in wider markets with the S&P 500 scaling a record peak and corn, soybeans and wheat also rising.

“If you’re going to have $6 corn and $14-15 soybeans, that has an impact on cotton- because the same farmers can plant other crops,” Love said.

Total futures market volume fell by 6,486 to 33,969 lots. Data showed total open interest gained 1,207 to 230,799 contracts in the previous session.


Source: Reuters
You can read the full article here: https://thrakika.gr/en/post/reuters-cotton-rises-over-3pc