Cotton futures sagged to a soft close Wednesday on sales by small speculators and the market is expected to drift until release of a key government plantings report next week, brokers said. The ICE Futures' May cotton contract eased 0.26 cent to end at 73.79 cents per lb, dealing from 73.06 to 75.38 cents.
The new-crop December cotton futures shed 0.62 cent to trade at 84.10 cents at 3:01 pm EDT (1901 GMT). "Thursday and Friday will be very slow," forecast Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia.
She said the market could just trade in a band while looking toward release of the annual potential plantings report of the US Agriculture Department on March 31. Most cotton industry analysts feel the data will show US 2008 cotton plantings ranging from 8.8 to 9.5 million acres, a 25-year low.
American farmers are switching out of cotton, especially in the swathe of states running from Georgia to Louisiana, after a sizzling rally that rocketed grains prices to multi-year highs.
Separately, cotton brokers said they expect the weekly USDA export sales report to show total US cotton sales would range from 300,000 to 500,000 running bales (RBs, 500-lbs each), versus sales in last week's report of 210,000 RBs. The brokers said US cotton shipments should hit between 250,000 and 300,000 RBs, from 257,300 RBs.
Brokers Flanagan Trading Corp sees support in the May cotton contract at 72.90 and 71.95 cents, with resistance at 73.82 and 74.90 cents. Volume traded in the cotton market on Tuesday was at 45,491 lots, with open interest in the market sliding 509 lots to 272,330 contracts as of March 25, exchange data showed.