Cotton futures settled largely easier Monday on sales by small speculators as most players appear to be waiting for release of a pair of government reports this week and next, analysts said.
The New York Board of Trade's March cotton contract shed 0.22 cent to conclude at 53.46 cents per lb, moving from 53.10 to 53.65 cents. May cotton eased 0.09 to 54.81 cents. The rest ranged from 0.20 cent up to 0.20 cent easier.
"We are marking time," said Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia.
He said the market may be waiting for release of the US Agriculture Department's weekly export sales report on Thursday and the monthly supply/demand report next Monday. Traders said the focus of the market may already be shifting from supply to demand, focusing particularly on the USDA's estimates for US cotton exports and imports from China, the world's top consumer of cotton.
"We know what we have," said Brown, adding the US cotton harvest will top 20 million (480-lb) bales. USDA forecast the US 2006/07 cotton crop at 21.3 million bales. For commodity funds who trade mainly on what kind of prices cotton contracts reach, a fresh rally toward the 54.50 cents area, basis March, would serve to confirm that the seasonal low caused by harvest pressure seems to be set, dealers said.
For Monday, fibre contracts traded in a narrow band as small speculators were seemingly content to trade the market in a band given the dearth of news in the pit, dealers said. Brokers Flanagan Trading Corp sees support in the March contract at 53 and 52.60 cents, with resistance at 53.80 and 54.50 cents. Floor sources said final volume hit around 7,000 lots, versus the previous tally of 15,756 lots. Open interest rose 376 lots to 160,290 contracts as of December.
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