NEW YORK: ICE cotton futures rose 1% on Tuesday, helped by strong demand for the natural fiber and a weaker dollar, as focus turns to a closely watched monthly supply and demand report from the US Department of Agriculture (USDA).
The cotton contract for March was up 1.13 cents, or 1%, at 116.35 cents per pound by 11:26 a.m. ET (1626 GMT). It traded within a range of 115 and 116.58 cents a lb.
“The demand continues and merchants report that they are selling fair amounts of cotton,” said Rogers Varner, president of Varner Brokerage in Cleveland, Mississippi.
Making cotton less expensive for overseas buyers, the US dollar fell 0.3% against its rivals.
The USDA’s monthly World Agricultural and Supply Demand Estimates (WASDE) report is due on Wednesday.
“It is WASDE week and we think this report has bearish potential, especially with respect to the US export and carryout projections,” said Louis Rose of Tennessee-based Rose Commodity Group in a note dated Monday.
“The overall standard daily technical analysis for the March contract remains bullish. The contract should experience resistance near 116-117 cents and support near 105, 100-102, 95-96.00 and 90-92 over the near-to-medium term.”
Chicago soybeans, corn and wheat futures inched up on Tuesday ahead of US government crop estimates.
Total futures market volume fell by 17,457 to 8,628 lots. Data showed total open interest fell 1,356 to 244,587 contracts in the previous session.
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