US cotton futures fell for a third straight session on Thursday, plumbing five-year lows, as traders shrugged off positive weekly exports data to focus again on a heavily supplied market for fibre. The most-active December cotton contract on ICE Futures US finished down 1.13 cents, or 1.8 percent, at 62.80 cents a lb.
The session low was 62.87 cents, the lowest since October 2009 for a benchmark second month contract in US cotton.
December cotton has lost a whopping 33 percent over the past two months. Thursday's losses came despite a 62 percent rise in weekly export sales of US cotton.
The market has slid steadily since the US Department of Agriculture projected last month that US cotton stockpiles will climb to a six-year high of about 5 million bales by the end of the 2014/15 crop year. The USDA has also forecast that global inventories will swell to a record of nearly 106 million 480-lb bales.
Traders were almost unanimous in calling for more losses in cotton in coming days, although some said panic had not seemed to set into the market yet.
"It is hard to call a bottom until desperation sets in, so we probably have a ways to go on the downside," Ron Lawson of Logic Advisors in Upper Saddle River, New Jersey, wrote in a commentary. "This is a bear market, please treat it as such."
Another trader said market technicals suggested the December contract could hold at the 60-62 cents level.
"Yet, the possibility of a trade below 60 cents looms large," he said. "The market is all but screaming for a correction, yet the bears are vigorously pushing for the 57 cent mark."
Comments
Comments are closed.