ICE cotton fell on Monday as speculators took profits in light trading following four consecutive weeks of gains and a weak US export sales report last week. The most-active May cotton contract on ICE Futures US fell 0.46 cent, or 0.7 percent, to settle at 64.20 cents a lb, the contract's third straight day of losses.
The drop was largely due to speculator profit-taking after fiber posted its fourth consecutive week of gains last week, said Michael Quinn, president and chief executive officer of Carolinas Cotton Growers Co-operative. That was cotton's longest streak of weekly gains since August. "We've had a pretty good run over the last several weeks," Quinn said. "The specs bought a lot of contracts on the way up. I wouldn't be surprised if there was some more consolidation on the downside."
Second-month cotton has now risen nearly 11 percent off near 5-1/2 month lows hit in late January. Speculators switched from a net short to a net long position during the rally, and raised that net long to its highest level since early June in the week ended February 17, US Commodity Futures Trading Commission data released Friday after market close showed. Monday's trading activity included some follow-through selling on Friday's US Department of Agriculture's (USDA) weekly export sales report, which showed cancellations of 141,100 bales of US cotton in the week ended February 12, Quinn said.
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