Source: Business Recorder

10 June 2021

NEW YORK: ICE cotton futures jumped to its highest in over a month on Wednesday as market participants awaited a federal supply and demand report that is expected to show higher export figures from the United States.

Cotton contracts for December rose 0.98 cent, or 1.1%, at 86.97 cents per lb, by 12:37 p.m. EDT (1637 GMT), having earlier hit its highest since May 6 at 87.10 cents.

The US Department of Agriculture’s (USDA) weekly export sales data and monthly supply and demand report is due on Thursday. “There’s been good demand, which has been consistent for several months and there’s anticipation that the USDA will raise the export number tomorrow and thereby cutting the carryout to a dangerously low level,” said Rogers Varner, president of Varner Brokerage in Cleveland.

The USDA in its May World Agricultural Supply and Demand Estimates (WASDE) report, raised estimates for US exports by 500,000 bales to 16.25 million bales for the 2020/21 marketing year, lowering ending stocks estimates down to 3.3 million bales.

Prices of the natural fibre have also been supported by unfavourable weather conditions in the major growing regions. It’s only slightly dry in Georgia and the Carolinas, but heavy rains in some areas around Memphis, Tennessee, have sparked concerns about replanting and have been a bullish factor in the last few days, Varner added.

Total futures market volume fell by 15,721 to 21,445 lots. Data showed total open interest fell 623 to 228,847 contracts in the previous session. – Reuters (Source: Business Recorder)