NEW YORK: ICE cotton futures rose on Tuesday on concerns about a drought in Texas, while strong performances from key grains also supported prices of the natural fibre.
The cotton contract for July was up 0.74 cent, or 0.89 %, to 84.00 cents per lb by 12:22 p.m. EDT (1622 GMT). It traded within a range of 83.49 and 84.6 cents a lb.
The drought conditions, rated ‘exceptional’ in certain parts of west Texas, continue to support the market, said Keith Brown, principal at cotton brokers Keith Brown and Co in Georgia. The US Department of Agriculture’s weekly crop progress report on Monday showed 11% of the total 2021 cotton crop was planted in the week ending April 18, above the five-year average of 9%.
“Cotton demand still looks robust, because in the last crop report, USDA increased the export category, that shows you that the USDA finally had to acknowledge the superior demand that has been unfolding in January, February and March,” Brown added. In its monthly supply and demand report, which was released on April 9, USDA hiked projections for US cotton exports and lowered estimates for ending stocks.
Sentiment for the natural fibre was also spurred on by a rise in soybeans, corn and wheat futures.