Cotton slumps to near 11-year low

ICE cotton futures tumbled to a nearly 11-year low on Monday as fears of easing demand, heightened by extension of US social distancing measures until the end of April, gripped a market already reeling from the economic fallout of the coronavirus outbreak.
Cotton contract for May fell 1.37 cent, or 2.67 %, at 49.96 cents per lb by 1:06 p.m. EDT (1706 GMT).
The contract hit a low since April 2009 at 48.80 cents per lb, earlier in the session.
"Cotton is down today on talk of big-time demand destruction... The demand loss is filtering all the way back in the chain, so cotton is very much affected," said Jack Scoville, vice president at Chicago-based Price Futures Group.
"We will be lower this week but we are probably doing a lot of it now."
"The stimulus is not going to immediately affect (positively) purchases of discretionary, semi-durable goods, which is mostly what cotton/textile goods are," said Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group. He added that the market could test the 40 cents level.
Cotton speculators increased their net short position by 1,252 contracts to 22,250 in the week to March 24, data from the US Commodity Futures Trading Commission showed.
Total futures market volume fell by 3,489 to 25,178 lots. Data showed total open interest gained 903 to 193,519 contracts in the previous session.