NEW YORK: ICE cotton futures are primed for their best month since April on stable global demand, despite being on track for its worst day in nearly two weeks on Friday as the dollar rose and grain prices weakened.
Cotton contracts for December fell 1.02 cent, or 1.1%, to 89.29 cents per lb, by 11:06 a.m. EDT (1506 GMT), falling as much as 1.6% earlier.
July has seen December 2021 futures set five contract highs and rise about 5% so far, predominantly on robust, consistent demand, with significant support coming from dips in the dollar and recent gains in the Chicago grains market.
But, a fall in core Chicago grains and an up tick in the dollar are weighing on prices on Friday, said Jordan Lea, senior trader at DECA Global, but said consumption is likely to continue to improve. Chicago wheat futures fell on Friday, but were on track for a second monthly gain after a severe drought curbed production of top quality spring crop in the United States.
Cotton is en route to a second straight weekly slide, with a fall of about 0.2% so far, hurt largely by Friday’s drop.
The dollar rose, hurting the demand for cotton by making it expensive for buyers using other currencies, but was down on a weekly and monthly basis.
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