REUTERS: ICE cotton futures set to gain for week
REUTERS: ICE cotton futures set to gain for week

REUTERS: ICE cotton futures set to gain for week

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NEW YORK: ICE cotton futures on Friday rose to near their highest level this month on speculator activity, with Chinese buying putting the natural fibre on course for a second weekly up-tick.

The cotton contract for December added 0.75 cents, or 0.7%, to 114.48 cents per lb by 13:43 p.m. EDT (1743 GMT), its best since Oct. 8.

"It is a mixed session with some positivity. We are still seeing a little bit of new buying momentum in the market," said Bailey Thomen, cotton risk management associate at StoneX Group. "There seems to be a little bit of activity coming out of the speculators' side along with some rolling action going from December to March."

Making the commodity expensive to overseas buyers, the US dollar rose against its rivals on Friday. The December contract, which has risen about 5.6% so far this week, is poised to be up for a second straight week, and is set for a monthly gain.

"US export sales were once again meeting high expectations," Peter Egli, director of risk management at British merchant Plexus Cotton, said in a note on Thursday. "Shipments were still slow but that is actually "more bullish than bearish, because it is a reflection of the empty supply pipeline."

This week's export sales report from the US Department of Agriculture showed net sales of 360,800 running bales of cotton, up 6% from the prior 4-week average, with increases primarily for top consumer China.

"With China still an active buyer thanks to the large spread between international and Chinese prices, and with fundamentals not offering a compelling reason to go short at this point, the path of least resistance is higher," Egli's note said.

Total futures market volume fell by 8,168 to 33,914 lots. Data showed total open interest gained 3,288 to 290,015 contracts in the previous session.


Source: Reuters

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