ICE cotton futures rose to their highest level in nearly two weeks on Friday after a US Department of Agriculture (USDA) report showed strong export sales last week, but prices pared gains later in the session. "Now, we're exceeding USDA projections pretty good," said Michael Quinn, president and chief executive officer of Carolinas Cotton Growers Co-operative, noting that the USDA would likely have to lower its forecast for year-end US inventories as a result of the strong export sales in recent weeks.
Cotton contracts for July settled up by 0.02 cent on Friday, a 0.03 percent gain, to 64.35 cents per pound. It traded within a range of 64.27 and 66.59 cents a pound, the highest level since May 18. Net export sales for the week ended May 21 were 117,500 bales, up 98 percent from the prior week, according to USDA data released Friday.
Investor Dennis Gartman wrote in his daily Gartman Letter on Thursday that cotton "has found its way back to our radar" and "we are turning bullish," statements that traders said contributed to some new speculator buying over the past two days. Gartman said his target is for December cotton futures to rise to 80-85 cents a lb "over the course of the next several months." December cotton closed Friday down 0.6 percent at 64.64 cents a lb.
December cotton's premium to July cotton fell to 0.29 cent a lb, down from 0.73 cent the prior session. Total futures market volume rose by 33,587 to 59,436 lots. Data showed total open interest gained 530 to 188,791 contracts in the previous session. Certificated cotton stocks deliverable as of May 28 totalled 124,606 480-lb bales, up from 122,220 in the previous session. The dollar index was down 0.11 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was up 1.09 percent. The Relative Strength Index in the most-active contract rose to 47.767.