Cotton hits near 2-week high on short-covering ahead of WASDE
- Cotton contracts for July rose 0.42 cent, or 0.75pc, to 56.69 cents per lb as of 1:00 p.m. EDT (1700 GMT).
- It traded within a range of 55.75 and 57.15 cents a lb, its highest since April 29.
Cotton contracts for July rose 0.42 cent, or 0.75pc, to 56.69 cents per lb as of 1:00 p.m. EDT (1700 GMT).
It traded within a range of 55.75 and 57.15 cents a lb, its highest since April 29.
"Prices are being boosted somewhat by pre-report positioning, looking for a greater need for squaring up position sizes rather than going through with a big bet," said Jon Marcus, president of Lakefront Futures and Options brokerage in Chicago.
The US Department of Agriculture's (USDA) monthly World Agriculture Supply and Demand Estimates (WASDE) report is due at 12:00 p.m. EDT (1600 GMT) on Tuesday.
"Another consumption reduction for the 2019/20 marketing year is likely, but most (market participants) will be focused on projections for 2020/21 and how the USDA views consumption for more than a year forward," Louis Rose, director of research and analytics at Tennessee-based Rose Commodity Group, said in a note.
Investors also awaited a cotton planting progress report due later in the day.
Speculators increased their net short position in cotton futures by 1,538 contracts to 13,023 contracts in the week to May 5, US Commodity Futures Trading Commission (CFTC) said on Friday.
Demand for cotton and apparel has been hammered by worldwide coronavirus restrictions, sending prices of the natural fiber tumbling 18pc so far this year.
While countries across the globe slowly eased coronavirus-led restrictions, fears about the possibility of a second wave of infections kept investors on edge, dampening sentiment in wider markets.
Total futures market volume fell by 12,749 to 12,611 lots.
Data showed total open interest fell 1,244 to 174,331 contracts in the previous session.