ICE cotton futures rose more than 1% to an eight-month high on Thursday, as investors remained bullish ahead of the US Department of Agriculture's monthly crop supply and demand report. Cotton contracts for March rose 0.86 cent, or 1.23%, to 70.82 cents per lb by 01:10 p.m. EST (1810 GMT).
It rose to 70.85 cents earlier in the session, the level last seen on May 10. "We are waiting for the crop report tomorrow, and trade estimate is that US cotton production is going to be down by a couple of hundred thousand bales," said Sid Love, commodity trading adviser at Kansas-based Sid Love Consulting.
"This swing is more supply oriented than demand because the demand may stay pretty steady, but if supply goes down, that is going to be helpful," Love added. The USDA's monthly World Agriculture Supply and Demand Estimates (WASDE) report is due on Friday.
The USDA's weekly export sales report will also be issued on Friday, after being delayed by a day due to adverse weather conditions. Elsewhere, the Chinese commerce ministry confirmed that a trade delegation led by Chinese Vice Premier Liu He would be visiting Washington next week to sign a Phase 1 trade deal.
Total futures market volume fell by 8,612 to 25,353 lots. Data showed total open interest fell 739 to 235,866 contracts in the previous session. Certificated cotton stocks deliverable as of Jan. 8 totaled 8,890 480-lb bales, down from 8,970 in the previous session.
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