New York cotton futures smidgen lower

Cotton futures settled softer on Wednesday on trade hedge and option-related sales as the market came off after the early strength in other commodity markets fizzled out late in the session, brokers said. ICE Futures open-outcry December cotton fell 0.10 cent to settle at 65.07 cents per lb, dealing from 64.85 to 65.75 cents.
On Tuesday, the contract ended at 65.17 cents in the highest close for cotton on a spot basis since ending at 65.40 cents on October 19. March shed 0.06 to 69.56 cents. The rest ranged from 0.10 cent lower to 0.49 cent higher. The ICE December electronic cotton contract was up 0.03 cent to 65.20 cents per lb at 2:42 pm EST (1942 GMT), dealing from 64.85 to 65.86 cents.
Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana, said futures rose in early trade due to "a combination of new lows for the dollar, sharply higher gold prices, continued rumours of Chinese interest for near term shipment and an outright buy recommendation for" the cotton market. But the surging rally in the commodities and energy complex stalled late and this dented the appetite for cotton.
Stevens said cotton prices will likely remain strong given the close above a key support level at 64.40 cents representing last week's high. Players will also be adjusting positions in cotton in front of the release on Friday of the US Agriculture Department's monthly supply/demand report.
Most analysts expect the USDA to raise its estimate for the US cotton harvest to around 18.2 million (480-lb) bales, from last month's forecast of 18.15 million. They also expect the government to possibly reduce its estimate for cotton output in Pakistan and China, the world's top consumer of cotton.
Brokers Flanagan Trading Corp said it sees resistance in the open-outcry December cotton contract at 65.60 and 66.20 cents, with support at 64.85 and 64.05 cents. Open-outcry cotton volume Tuesday was 11,507 lots and screen business hit 28,304 lots, the exchange said. Open interest in cotton futures rose 5,061 lots to 250,060 lots as of November 6.