New York cotton at two-week high

Cotton futures finished Thursday at a two-week high on heavy speculative buying sparked by strong US cotton sales, and brokers said the market may grind higher in the days ahead. The New York Board of Trade's key March cotton contract shot up 1.67 cents to end at 44.74 cents a lb, dealing between 43.40 and 45 cents. It was the highest close for cotton on a spot basis since 46.78 cents on January 26.
May surged 1.59 to 45.87 cents and the rest rose 0.90 to 1.55 cents.
Jobe Moss of brokers and merchants MCM Inc in Lubbock, Texas, said that once the March contract surged past 43.75 cents, automatic buy orders kicked in to spur fibre contracts.
He said the market "may have a shot at 46 cents" from follow-through buying over the next few sessions.
The spark for the advance was provided in part by strong US cotton sales posted in the US Department of Agriculture's weekly export sales report.
USDA said US cotton sales soared to a hefty 454,600 running bales (RBs, 500-lbs each), versus trade belief it would only range from 300,000 to 400,000 RBs. US cotton shipments of previously booked orders stood at 273,400 RBs.
"We couldn't extend lower and sales were so good there was no way to go but up," a dealer said.
Brokers Flanagan Trading Corp said in a report that "export sales were strong this week" and the brisk level of trade buying would suggest "that export sales are continuing at a strong pace."
The market also continued to see heavy switch trade as players transferred their positions out of spot March and into the market's back months ahead of the delivery period in the March contract on February 22.
Open interest in March fell 2,060 lots to 37,380 lots as of February 9 while interest in May rose 4,952 lots to 35,298 lots.
Flanagan Trading sees resistance in the March contract at 45.35 and 46 cents, with support at 44.55 and 43.55 cents.
Floor traders said final estimated volume stood at a heavy 35,000 contracts, above Wednesday's tally of 25,479 lots. Open interest rose 3,554 contracts to 96,238 lots as of February 9.