ICE cotton futures hit a 5-month low on Thursday in a broader markets sell-off after the United States imposed restrictions on travel from Europe that sparked demand fears.
Cotton contract for May fell 1.19 cent, or 1.9%, to 60.36 cents per lb as of 1:37 p.m. EDT (1737 GMT). It traded within a range of 59.35 and 61.6 cents a lb.
The contract earlier in the session fell as much as 3.6% to 59.35 cent per lb, its lowest since late September.
"The overall concern is what are consumers going to do? If people pull down on consumption, lock their houses and do not shop that's a lot more important than whether mills are buying or not," said John Bondurant, a trader in Memphis, Tennessee.
Concerns over the coronavirus outbreak overshadowed data from the United States Department of Agriculture (USDA) that showed net sales hit a fresh marketing year high.
Net sales of 484,200 running bales were up 22% from the previous week and 62% from the prior 4-week average.
President Donald Trump ordered travel from Europe to the United States to be restricted for 30 days, responding to mounting pressure to take action against a rapidly spreading coronavirus outbreak.
The lack of clarity over the US public health response coupled with the absence of targeted stimulus measures added to the uncertainty.
"If our politicians cannot come to an agreement on a bailout, things could really ugly and we (the cotton market) could be heading towards the mid-50s," said John Payne, senior broker at Daniels Trading.
Total futures market volume rose by 29,087 to 56,050 lots. Data showed total open interest gained 1,989 to 212,785 contracts in the previous session.
Certificated cotton stocks deliverable as of March 11 totalled 39,758 480-lb bales, up from 39,670 in the previous session.
Comments
Comments are closed for this article.