Cotton slumps over 4 percent

Cotton sunk over 4% on Friday as investors' sentiment soured on Washington's plans to impose tariffs on Mexico, while rains in major crop planting areas in the United States added pressure on the natural fibre.
Cotton contracts for July settled down 3 cent, or 4.4%, at 65.59 cents per lb. It traded within a range of 65.59 and 68.72 cents a lb.
The front month contract was down as much as 3.7% for the week. Earlier in the session, the front month contract traded limit down, falling 3 cents to 65.59 cents per lb, its lowest since May 14.
"We do not know whether or not we will be imposing tariffs on Mexico," Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group said, also adding that rains across south Georgia, southeastern Alabama, and the Florida panhandle have been beneficial to planting.
US President Donald Trump's administration on Friday proceeded with a plan to slap a 5% tariff on imports from Mexico, alongside migration talks with Mexican officials in Washington.
Also weighing on prices was Thursday's weekly export sales report from the US Department of Agriculture (USDA) which showed net sales and exports had dipped considerably.
Investors are currently awaiting the USDA's monthly World Agriculture Supply and Demand Estimates (WASDE) report due on Tuesday.
"There are some notions of larger expected carryout for marketing year 2019/20 crop for the United States ahead of next week's WASDE report. So, there is caution amid people holding long and trying to get rid of those ahead of the report," Rose said.
The USDA's monthly World Agriculture Supply and Demand Estimates(WASDE) report is due on Tuesday.
"I do not think the July cotton is coming back higher," said Keith Brown, principal at cotton brokers Keith Brown and Co in Moultrie, Georgia, adding that prices could likely trade between 64.50 and 69 cents.
Total futures market volume rose by 20,583 to 55,425 lots. Data showed total open interest fell 100 to 208,967 contracts in the previous session.
Certificated cotton stocks deliverable as of June 6 totalled 85,903 480-lb bales, up from 81,462 in the previous session.