New York cotton hits 6-1/2 month high, then slips on export data
Lower weekly export sales of US cotton helped push prices of the fibre down on Thursday after a three-day runup, but not before the market hit a 6-1/2 month high on a fresh burst of buying. "It's fair to assume the rally of the past three days was enough to throw the brakes on the market, and we really have to see the exports perform from here," said Sharon Johnson, senior cotton analyst at KCG Futures, a division of commodities broker Knight Capital, in Roswell, Georgia.
Copyright Reuters, 2014
The most-active May cotton contract on ICE Futures US settled down 0.52 cent, or 0.6 percent, at 91.68 cents a lb after racing to a session high of 93.75 cents. That was the highest since August 16, when the front-month contract rose to an intraday high of 93.90.
Net upland weekly sales of US cotton were 60,000 bales for the week ended March 12, down 62 percent from the previous week, data from the US Department of Agriculture showed. The figure was also 36 percent lower than the prior four-week average. Cancellations of orders were reported from Turkey (19,300 bales), Vietnam (11,700 bales), and India (3,900 bales). Thomson Reuters data showed May cotton reaching its session high at 8:40 am EDT (1240 GMT), some half hour before the release of the export data. The market became somewhat volatile before moving decidedly lower from 1 pm onward.
Despite expectations world supplies of cotton to be at record levels by the end of July, tight nearby supplies in the United States have underpinned domestic prices of the fibre for the 2013/14 crop year that began August 1. US cotton prices have also held up despite synthetic fibres making inroads in domestic apparel manufacture. Despite Thursday's lower close, the front-month contract for New York cotton shows a 6 percent rise for March and a more than 8 percent gain year-to-date.