Cotton futures ended marginally firmer Friday as fibre contracts rose for the first time in three sessions, although the market stayed range-bound while looking toward developments which could spur business next week, analysts said. Benchmark March cotton on ICE Futures US rose 0.02 cent to finish at 95.61 cents per lb, moving from 95.30 to 96.49 cents. It was an inside day for the second straight session since the range was within Thursday's 95.29 to 97.41 cents band.
On the week, the market was down 2.6 percent. Volume Friday amounted to more than 13,500 lots, over 15 percent below the 30-day norm, according to preliminary Thomson Reuters data. "It's consolidating at the lower end of the trading range," said Mike Stevens, an independent cotton analyst in Louisiana. Traders said the market has been drifting along, but some developments should perk up activity next week.
China, the world's top consumer of cotton, will come back from the Lunar New Year holidays. Next Friday, the US industry group National Cotton Council will release its annual survey of potential US cotton plantings in 2012. "The survey by the NCC should start people focusing on the spring planting season. The Chinese were not completely away, but its been quiet there all of last week due to New Year," a dealer said.
Analysts said the nearby downside targets for the March cotton contract could be found at 94.52 cents, which was the January 13 low, then the January 12 low of 94.13 cents and after that the January 9 low of 93.22 cents. Open interest, an indicator of investor exposure, stood at 166,088 lots as of January 26, the first time in 12 sessions that it declined, ICE Futures US data showed. On Wednesday, it stood at 166,183 lots, having posted a rise of almost 10 percent so far this year. Thursday's volume stood at 18,953 lots, from the Wednesday tally of 25,357 lots, the exchange data showed.
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