Cotton prices rose for a second straight session on Thursday, following a rise in the grains market, while rain in the cotton-planting belt continued to support the natural fibre. The most active cotton contract on ICE Futures US, the third-month December contract, rose 0.62 cent, or 0.94%, at 66.50 cents per lb. It traded within a range of 65.47 and 66.75 cents a lb. "There is an overall optimism in commodities. Corn, soy and wheat are up and that is helping cotton," said Sid Love, commodity trading adviser at Kansas-based Sid Love Consulting.
Chicago corn, soybeans and wheat extended a rally on Thursday as forecasts of more rain in the US Midwest threatened to worsen planting delays that have put a question mark over this year's harvest. "Weather is not perfect in the cotton belt either, clearly there are some issues with the crop down in Texas," Love added.
Heavy rains have plagued US farmers in cotton-producing states during the past few weeks. The US Department of Agriculture (USDA) reported net sales of 75,100 running bales (RB) for the marketing year 2018/2019 were down 59% from the previous week while exports of 360,400 RB were up 17%. USDA is expected to report its estimates for all cotton planted acres in the United States on June 28.
Meanwhile, the tit-for-tat import tariffs between Beijing and Washington continue to loom over consumer sentiment and investors remain hopeful of a trade agreement between the world's two largest economies. The China Cotton Association will submit an application for a waiver on import duties on uncombed cotton from the United States. Total futures market volume fell by 8,124 to 46,235 lots. Data showed total open interest fell 351 to 206,044 contracts in the previous session. Certificated cotton stocks deliverable as of June 12 totalled 88,340 480-lb bales, up from 88,260 in the previous session.
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