NEW YORK: ICE cotton futures rose on Tuesday as the dollar weakened, while robust demand and anticipation of further economic stimulus in the United States offered additional support.
The cotton contract for March rose 0.61 cent, or 0.8%, to 81.31 cents per lb by 12:16 p.m. EST (1716 GMT).
“The US dollar is a little weaker ... The US harvest is over and our demand profile remains very strong. Also, it looks like we are headed higher so, the funds are buying,” said Jack Scoville, vice president at Chicago-based Price Futures Group.
“Demand in the market remains pretty steady and the recent export sales report was positive,” said Bailey Thomen, cotton risk management associate with StoneX Group.
“Traders are looking ahead to see if there is going to be an additional round of economic stimulus being put into the market,” Thomen added.
The USDA’s weekly export sales report on Thursday showed net sales of 326,000 running bales (RB) for 2020/2021, up noticeably from the preceding week, while exports of 274,600 RB were up 2%.
Meanwhile, US President-elect Joe Biden’s nominee for Treasury Secretary, Janet Yellen, urged lawmakers on Tuesday to “act big” on the next coronavirus relief package, adding the benefits outweigh the costs of a higher debt burden. Total futures market volume fell by 2,706 to 21,392 lots.