REUTERS: Cotton slips as speculators liquidate ahead of WASDE report

REUTERS: Cotton slips as speculators liquidate ahead of WASDE report

Cotton prices fell on Tuesday following a sharp rise in the last session as speculators squared positions ahead of a federal supply and demand report due later this week, while overall demand remained soft amid rising COVID-19 cases.

The cotton contract for March was down 0.49 cent, or 0.7%, at 71.89 cents per lb by 11:58 a.m. EST (1658 GMT), after rising more than 1% in the previous session.

"Today's volatility is likely because of the WASDE release on Thursday. Specs are heavily long and we are probably seeing pre-report liquidation," said Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group.

"We do not expect nearby futures to trade above 75 cents over the near-term and probably not below 65, if 67.50 is breached. Overall, demand is nothing to be excited about," he added.

Market participants now await the USDA's monthly World Agriculture Supply and Demand Estimates (WASDE) report on Thursday and weekly export sales report.

Strict restrictions in California due to surging coronavirus cases also weighed on investor sentiment.

Nationwide, US COVID-19 infections are at their peak, with an average of 193,863 new cases reported each day over the past week, according to a Reuters tally of official data, and health officials warned the worst is yet to come.

Meanwhile, the US Congress is expected to vote this week on a one-week stopgap funding bill to provide more time to reach a deal on COVID-19 economic relief.

Total futures market volume fell by 16,060 to 8,148 lots.

Certificated cotton stocks deliverable as of Dec. 4 totaled 100,647 480-lb bales, down from 101,220 in the previous session.


Source: Reuters
You can read the full article here: https://thrakika.gr/en/post/reuters-cotton-slips-as-speculators-liquidate-ahead-of-wasde-report