NEW YORK: Cotton futures up 1percent on strong demand, set for best week since early June July 16 (Reuters) - ICE cotton futures for December firmed on Friday on robust demand and stronger grains, setting a contract high for a third straight session en route to their best week in over a month.
Cotton contracts for December were up 0.75 cent, or 0.8percent, to 89.80 cents per lb at 12 p.m. EDT (1600 GMT), having earlier gained 1percent to touch a new contract-high of 89.97 cents per lb.
"The macro fundamentals are definitely supportive. The crop is better than we anticipated probably at this point, but that's not enough to overwhelm the the real demand we're experiencing right now," said Jordan Lea, senior trader at DECA Global.
Chicago wheat rallied again on Friday, putting it on track for its biggest weekly gain in four years, while corn and soybeans were also set for weekly gains, lifting cotton prices.
"Supply is tight on yarn, especially in certain markets like the United States, where they're having trouble with staffing, so not all our mills are running at capacity," Lea noted.
The December contract is poised for its best weekly showing since the week of June 4, having gained about 2.5percent so far.
"We might settle into a slightly higher trading range, but it will take a weather or macro event to move the market more than a few cents in either direction," Peter Egli, director of risk management at British merchant Plexus Cotton, said in a note on Thursday.
"As long as demand remains strong, it will be difficult for the market to come under too much pressure, even if crops continued to progress well," Egli's note added.
Total futures market volume fell by 8,132 to 9,931 lots. Data showed total open interest gained 1,944 to 235,907 contracts in the previous session.
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