Cotton futures maintained losses from earlier in the session on Monday after the US Department of Agriculture raised projections for US and world production and ending stocks in the 2014/15 crop year. The front-month March cotton contract on ICE Futures US was trading 1.2 percent lower at 60.03 cents a lb at 12:30 pm EST (1730 GMT), but did not reach the session's low of 59.51 cents a lb hit in morning trading.
The USDA's January World Agriculture Supply and Demand Estimates report showed an increase in US ending stocks to 4.7 million bales, up from the December estimate of 4.6 million bales, and an increase in world ending stocks to 108.64 million bales, up from 108.08 million bales in December.
"Selloff seems exaggerated given the small changes," Sharon Johnson, a cotton specialist at Wedbush Securities in Roswell, Georgia, said in a note following the report's publication. The report also raised its projection for US production to 16.08 million bales, from 15.92 million bales in December, and increased its world production forecast to 119.17 million bales from 118.98 million bales in December. It lowered its demand estimate for top-consumer China to 36.5 million bales, down from 37 million bales in December, noting that mills had been slow to respond to falling domestic cotton prices.
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