NEW YORK: ICE cotton futures rose as much as 2.1% on Wednesday, supported by a strong weekly exports sales report and a weaker US dollar, with prices of the natural fibre also latching onto upbeat sentiment in wider markets.
The cotton contract for March was up 1.05 cents, or 1.4%, at 75.87 cents per lb by 11:11 a.m. EST (1611 GMT). It traded within a range of 74.4 and 76.4 cents a lb. “There is general buying in the agricultural space today. The US dollar is down again that is supportive and the export sales report, at least for cotton, was super strong one more time,” said Jack Scoville, vice president at Chicago-based Price Futures Group.
The US Department of Agriculture’s weekly export sales report showed net sales of 416,700 running bales for 2020/2021, slightly lower compared with the previous week but up 14% from the prior four-week average. The USDA released its weekly export sales data a day earlier than usual due to the Christmas Day federal holidays on Thursday and Friday. The dollar index fell 0.4% against its rivals, making the natural fibre less expensive for buyers of cotton in other currencies.
Meanwhile, Chicago soybeans touched a 6-1/2-year peak as investors positioned for dry crop weather coupled with an Argentine labour strike curbing South American export supply.
Total futures market volume fell by 9,624 to 12,857 lots.
Certificated cotton stocks deliverable as of Dec. 22 totalled 77,326 480-lb bales, unchanged from 77,326 in the previous session.—Reuters
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