Cotton futures finished lower on Monday on investor sales and in line with weaker soybean values in Chicago, dealers said. The key December cotton contract fell 0.71 cent to end at 79.40 cents per lb, dealing from 78.80 to 80.12 cents.
Spot July cotton lost 0.79 cent to close at 70.88 cents, trading from 70.50 to 71.79 cents. Volume traded in the December contract stood at 7,483 lots at 2:44 pm EDT (1844 GMT) while July volume amounted to 2,689 lots. Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia, said a lack of follow-through buying in fiber contracts led the market south. Traders said likely deliveries against the July contract marginal at best.
Open interest in July contract at 6,900 lots as of June 20. Analysts pegged open interest in the contract at the close on Monday at around 3,000 to 4,000 lots. Market still keeping an eye on conditions in Texas and will monitor the weekly crop condition report from US Agriculture Department being released at 4:00 pm EDT (2000 GMT).
Cotton industry sources in Texas said the state could lose up to 1.5 million acres from weeks of blowing wind, hail and extreme heat. The market is also looking toward release of the USDA's annual planted acreage report next Monday, June 30. Trade sources said consulting firm Informa Economics was said to have estimated US 2008 cotton plantings at 8.935 million acres. Informa officials were not available to comment on their figure.
In March, USDA forecast US cotton sowings in 2008 at 9.39 million acres. Traders said they see support in the December contract at 79 cents, with resistance pegged at 79.95 and 80.05 cents. Volume traded Friday hit 16,012 lots, exchange data showed. Open interest in the cotton market dropped 2,823 lots to 217,383 lots as of June 20, ICE Futures US said.
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