August 14, 2020
NEW YORK: (Reuters) : ICE cotton futures climbed 2% earlier on Thursday, on track for their biggest daily rise in nearly two weeks, after weekly US data showed solid exports to China, while dry weather lent further support.
Cotton contracts for December were up 0.97 cent, or 1.6%, at 63.17 cents per lb at 1:22 p.m. EDT (1722 GMT). The US Department of Agriculture’s (USDA) weekly export sales report showed exports of 278,600 running bales, out of which 157,100 running bales were shipped to China in the week to Aug. 6.
“China has taken the lion’s share of those new exports this week. ... That is a very positive factor for the market,” said Bailey Thomen, cotton risk management associate with StoneX Group, adding that drier weather provided further support. Cotton could also be carrying some strength over from other markets like grain and stocks, Thomen said.
Chicago corn prices surged to the highest level in nearly three weeks on worries over storm damage in the US Midwest, while soybeans climbed to a 10-day high amid brisk export demand.
Buoying prices further, the dollar index fell to its lowest in a week, while the S&P 500 neared an all-time high.
The United States and China are to review their Phase 1 trade deal in an Aug. 15 meeting. The United States is the biggest exporter of cotton, while China its largest consumer. US-China ties have deteriorated over a range of issues, adding to woes for the cotton market battling lower demand due to the global pandemic, which has sent prices over 10% lower so far this year.
Total futures market volume fell by 13,574 to 14,762 lots. Data showed total open interest fell 976 to 190,218 contracts in the previous session.—Reuters (Source: Business Recorder)