NEW YORK: ICE cotton futures fell on Monday, as favourable weather and robust crop conditions in top cotton-growing regions in the United States weighed on prices.
The most active cotton contract on ICE Futures US, the third-month December contract fell 0.07 cent, or 0.1%, at 59.74 cents per lb by 1:58 p.m. EDT (1758 GMT).
"We had some pretty good weather over the weekend and the forecast is good for the Rio Grande Valley and for the Delta crops," said Rogers Varner, president of Varner Brokerage in Cleveland.
Texas and other major cotton-growing regions in the United States have experienced a dry spell, raising concerns of crop damage.
"The other influence on the market is that China now says that they are going to require inspections and affidavits of agriculture purchases, and traders are worried that grains, cotton and pork may get tied up in some sort of dispute," Varner added.
Cotton prices have declined about 16% so far this year, hurt by the coronavirus pandemic that stalled economic activity and consumption, while concerns of increasing US-China trade tensions also remained on the horizon.
"Cotton may benefit from China's attempting to fulfill the Phase One trade obligations, but is likely to find itself short of downstream buyers in a Covid-19 environment," OCBC Bank said in a note.
Investors now eye a weekly cotton planting progress report due later in the day.
Speculators cut net long position in cotton futures by 3,330 contracts to 552 in week to June 16, data showed on Friday.
Total futures market volume fell by 2,005 to 15,989 lots. Data showed total open interest fell 2,246 to 165,489 contracts in the previous session.
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