Favorable U.S. crop outlook contributed to pressure. Traders looked to the U.S. weekly export sales report on Thursday. Global cotton trade projected to fall 13% in 2014-15 to the lowest in four years.
Cotton futures fell to a new low for the move in most-active December and closed with a triple-digit loss for the second straight day Wednesday.
December shed 123 points to settle at 75.26 cents, in the lower quarter of its 178-point range from up 32 points at 76.81 to down 146 points at 75.03 cents. It closed 948 points or 11.2% below its May 8 high.
Maturing July closed off a point at 81.80 cents, also in the lower reaches of its 250-point range from 83.75 to 81.25 cents and a new low finish since December. The last trading day for July is July 9.
Expectations that favorable weather has boosted U.S. production prospects from USDAΆs initial forecast have contributed to the pressure on new-crop prices.
Volume rose to an estimated 18,800 lots from 11,654 lots the previous session when spreads totaled 2,226 lots or 19%. Options volume totaled 1,688 calls and 5,322 puts.
Traders awaited the U.S. export sales and shipments report for the week ended July 19 amid some talk that a big sale might have been canceled. The USDA report will be released at 7:30 a.m. Thursday.
Global cotton trade is forecast by USDA to reach only 35.6 million bales in 2014-15, down 13% from 2013-14 and the lowest in four years, mainly because of ChinaΆs expected reduction in imports.
China is projected to import only 8 million bales, down 5.5 million bales from the estimate for this season and a third of the record 24.5 million bales imported just three years ago.
Most other importing countries are expected to have offsetting changes in 2014-15, with rising imports foreseen for Bangladesh, Indonesia and Pakistan, while declines are expected in Turkey and Vietnam.
Declines are projected across major exporting counties in 2014-15 with the exception of Brazil, which is rebounding from limited exportable supplies in 2013-14. BrazilΆs exports are forecast to increase a million bales to 3.3 million.
Significant export reductions are seen for India and Australia of 37% to 5.7 million bales and 35% to 3.1 million bales, respectively. Shipments from Uzbekistan are expected to fall 7% to 2.5 million bales.
Despite larger domestic supplies, U.S. exports are projected to fall 8% to 9.7 million bales in the 2014-15 marketing year beginning Aug. 1.
Futures open interest dropped 342 lots Tuesday to 145,458, with JulyΆs down 358 lots to 3,024 and DecemberΆs down 25 lots to 121,192. Certificated stocks grew 5,387 bales to 444,585. Awaiting review were 21,398 bales.
World values as measured by the Cotlook A Index gained 85 points Wednesday morning to 90.60 cents. The premium to TuesdayΆs July futures settlement widened 486 points to 8.79 cents.
Forward A Index values for 2014-15 fell 145 points to 83.30 cents, widening the discount to the 2013-14 index by 60 points to 7.30 cents and narrowing the premium to TuesdayΆs December futures close by 26 points to 6.81 cents.
