ICE cotton futures fell to a five-week low on Tuesday, as investors continued to liquidate long positions and the dollar gained in strength. The March cotton contract on ICE Futures US ended down for the third straight session and dropped to a low of 69.32 cents per lb, a bottom lasted reached on November 14.
"It's the same thing as yesterday ... Specs are record long so it will take weeks for them to get neutral," said Rogers Varner, president of Varner Brokerage in Cleveland, Mississippi. The dollar rose to a 14-year high on Tuesday as Federal Reserve Chair Janet Yellen's comments on jobs the day before reinforced expectations of more frequent US interest rate increases next year than previously expected.
March cotton contract on ICE Futures US settled down 0.23 cent, or 0.33 percent, at 69.34 cents per lb. It traded within a range of 69.32 and 69.84 cents a lb. Total futures market volume fell by 18,370 lots to 18,651. Open interest fell 5,143 contracts to 247,375 in the previous session. The dollar index was up 0.16 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was down 0.34 percent.