Cotton futures settled marginally higher late Wednesday on buying by small speculators and the market may stay in a band given the dearth of leads in the ring, brokers said. The ICE December electronic cotton contract rose 0.29 cent to trade at 64.16 cents at 3:11 pm EDT (1911 GMT), dealing from 63.82 to 64.35 cents.
ICE Futures open-outcry December cotton went up 0.21 cent to end at 64.08 cents per lb, trading from 63.80 to 64.35 cents. It was an inside day since the range was within Tuesday's 63.58 to 64.40 cents band. March rose 0.16 to 68.74 cents. The rest gained 0.05 to 0.45 cent.
"We're literally just squatting (here)," said Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana. He said the benchmark December cotton contract appears trapped between 63.50 and 64.50 cents and that news would be need to pull the market out of this band.
For today at least, sharp movements in other commodity markets failed to inspire similar gyrations in cotton futures, dealers said. Cotton rallied recently due to worries that US cotton plantings next year would fall even further than the 11.01 million acres sown to cotton in 2007, a level representing an 18-year low.
Analyst estimates of US cotton sowings range from 9.4 to 10 million acres and the primary cause would be searing rallies in the grains pit which could prompt American farmers to plant more profitable crops than cotton.
Separately, brokers said they will also look at the pace of US cotton sales. They said the weekly export sales report from the US Agriculture Department should show total US cotton sales at 125,000 to 200,000 running bales (RBs, 500-lbs each), from 206,700 RBs in last week's report.
Brokers Flanagan Trading Corp sees resistance in the open-outcry December cotton contract at 64.85 cents, with support at 64.05 and 63.25 cents. Open-outcry cotton volume Tuesday was 9,385 lots, while screen business reached 26,321 lots. Open interest in the cotton market fell 100 lots to 248,750 lots as of October 30.
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