ICE cotton futures jumped over 2 percent on Monday, supported by technical buying and mill fixations, as prices crossed a key level for the first time in over two months amid quality concerns about this year's crop. Cotton contracts for March settled up 1.5 cent, or 2.16 percent, at 70.85 cents per lb after ranging between 69.41 and 70.92 cents a lb - a peak since September 12.
"The price movement was underpinned by mill fixations, technical buying and some crop scale back in terms of quality," said Peter Egli, director of risk management at British merchant Plexus Cotton. "Right now, there is a lot of buying with not enough selling to push the market down," Egli added. The March contract crossed the key 70-cent a lb level for the first time in over two months. It also registered its highest one-day percentage gain since October 23.
"Internationally, concerns continue to emerge regarding the overall quality of this year's crop," Louis Rose, co-founder and director of research and analytics at Rose Commodity said in a note. "Nations whose crops exhibit varying issues are Greece, Turkey, Pakistan and India," Rose said.
Meanwhile, the US Department of Agriculture's (USDA) weekly crop progress report showed 74 percent of cotton crop was harvested in the United States by the week ended November 19, up from 64 percent in the previous week. Total futures market volume rose by 12,276 to 51,392 lots. Data showed total open interest gained 236 to 223,954 contracts in the previous session.
Certificated cotton stocks deliverable as of November 17 totalled 47,951 480-lb bales, unchanged from 47,951 in the previous session. The dollar index was up 0.43 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was down 0.62 percent.
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