Cotton futures fell one percent on Tuesday, recording the biggest one-day percentage drop in over two weeks, hurt by weaker demand for US cotton. "Polyester prices are running at about half that of cotton and Indian cotton is becoming more available," said Rogers Varner, president of Varner Brokerage in Cleveland, Mississippi.
The US Department of Agriculture's weekly crop progress report released on Monday showed that 77 percent of cotton crops were harvested in the United States by the week ended November 27, up from 67 percent in the previous week. "Yesterday's CFTC report showed a record increase in long positions by speculators last week. That may have taken a bit of buying off the market," said Peter Egli, director of risk management at British merchant Plexus Cotton.
According to CFTC data, speculators raised their net long position in cotton by 23,782 lots to 100,648 lots in the week to November 22, marking the highest level since the data became publicly available in 2006. The March cotton contract on ICE Futures US settled down 0.72 cent, or 1.00 percent, at 71.3 cents per lb. This was the biggest one-day percentage drop since November 11. The contract traded within a range of 70.87 and 72.1 cents a lb. Total futures market volume rose by 974 to 16,202 lots. Data showed total open interest gained 1,807 to 255,473 contracts in the previous session.