NEW YORK: ICE cotton futures fell more than 1% on Tuesday as investors booked profits ahead of the US Thanksgiving holiday after the natural fiber hit an 18-month high in the previous session. The cotton contract for March was down 1.14 cent, or 1.5%, at 72.66 cents per lb by 12:02 p.m. EST (1702 GMT).
Prices on Monday hit 74.27 cents, its highest level since May 7, 2019, helped by vaccine hopes and a rally in gains market.
"Traders are most likely liquidating longs ahead of the long holiday weekend and booking profits," said Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group.
"The overall sentiment in the market is bearish with the surging Covid-19 virus. ... Prices have been rising on a decrease in open interest, which is a sign of lower prices ahead," he added.
More than 59.22 million people have been reported to be infected by the novel coronavirus globally and 1,397,086 have died, according to a Reuters tally. However, recent promising Covid-19 vaccine results from Pfizer, Moderna and AstraZeneca have raised hopes for a quick economic rebound, boosting investors appetite for riskier assets.
Meanwhile, the weekly crop progress report from the US Department of Agriculture (USDA) on Monday showed 77% of US cotton was harvested, compared with 69% last week. Most of the US markets will be closed on Thursday for the Thanksgiving holiday.
Total futures market volume fell by 9,224 to 18,874 lots. Certificated cotton stocks deliverable as of Nov. 23 totaled 119,220 480-lb bales, down from 121,046 in the previous session.
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