US cotton futures fell for a second day on Thursday as traders and investors looked beyond encouraging weekly sales to focus on cooler weather in the near term in Texas that could boost the crop in the top cotton growing state. The most-active July cotton contract on ICE Futures US settled down 0.58 cent, or 0.7 percent, at 85.50 cents a lb in New York. In the previous session, July cotton lost 1.33 cents, or 1.5 percent, snapping a four-day gain.
US Department of Agriculture data released on Thursday showed net sales of all upland cotton rose 2 percent from the prior four-week average, after higher demand from China, Turkey, South Korea, Taiwan, Thailand and Guatemala. Even so, the market's concerns were more on the cooler weather patterns - and possible rains - developing in Texas' main cotton growing regions in the West, traders said.
The changing weather could bring relief to crops, after the drought earlier in the year that caused undue stress for cotton plantings and sent prices to 2-year highs, above 96 cents a lb. Weather forecaster Accuweather.com said one of Texas' key cotton districts, Lubbock, will experience temperature declines from a high of 90 Fahrenheit on last Saturday to below 80 Fahrenheit by the weekend.
"There is also some hint of rain in West Texas this weekend from other weather tracking models we follow," said Keith Brown of cotton brokers Keith Brown & Co in Moultrie, Georgia. In the week ahead, the market's attention is expected to be on USDA's next global supply-demand report for cotton, due on June 11. At the close of Wednesday's trading, open interest in cotton on ICE Futures stood at 187,015 lots, the lowest since April 28. Volume dropped to 29,170 from the previous session's 33,473.
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