Cotton closes near seven-week low

Cotton futures closed at near 7-week low in New York on Tuesday as players awaited more clarity on the US harvest of the fibre amid signs of a bumper crop in India. Cotton's traded volume on ICE Futures US was about half of the 30-day average, according to preliminary Thomson Reuters data, as the market ended with a third losing session in a row.
"Right now, there's just not a great deal going on to push the market back up," said Sharon Johnson, analyst at Knight Capital's KCG Futures in Roswell, Georgia. "Everyone's waiting for a better picture of the supply-demand situation, and we'll only get that when USDA puts out its next monthly supply-demand report in three weeks," she said in a telephone interview.
Many monthly US crop reports were delayed in October after a government shutdown that lasted 16 days. ICE's most-active December cotton contract closed down 0.61 cent, or 0.7 percent, at 82.45 cents a lb, after a session low at 82.44. It was the market's lowest close since September 5.
Data on Tuesday showed there were 16,432 bales of cotton certified for delivery, making available 88,338 bales in total for delivery. "Certified stocks are likely to continue to rise as the harvest progresses," John Flanagan at Flanagan Trading Corp in Fuquay-Varina, North Carolina, said in a note. The outlook for the US harvest was mixed with traders saying the pace of cotton picked for the current season was lagging although the quality of the fibre was for the large part between good and excellent.
As of Sunday, about 21 percent of the nation's cotton had been picked, triple that of September 29 levels, although that was still 15 percent behind last year's levels, KCG Futures' Johnson said in a note. Texas, the state with the largest planted area of cotton, has picked just 15 percent, half the 2012 level and 12 percent behind its 5-year average, she said.
Other lagging states were Arkansas, California, Missouri, Oklahoma and Tennessee. "The lag in harvest progress, especially in Texas, leaves more of the crop open to adverse weather whether it be freezing temperatures or excessive rainfall," Johnson wrote in her commentary. "Cool temperatures have also been of a concern the past two weeks." In India, meanwhile, a grouping of regional cotton associations and co-operatives have indicated that the country's cotton crop would be around 38.1 mln local bales, or the equivalent of 29.7 mln 480-lb bales, a new record.