ICE cotton futures edged up slightly after touching their lowest in more than two-weeks on Friday after the demand outlook from the United States Department of Agriculture on Thursday disappointed investors. The most active ICE cotton contract for July expiry settled up 0.06 cent, or 0.1 percent, at 84.62 cents per lb. It traded within a range of 83.5 cents - its lowest since April 25 and 84.96 cents.
On a weekly basis, the contract fell 2 percent - its biggest decline since the week ending Feb. 2. The USDA projected 2018/19 US cotton exports at 15.50 million bales, the same as its 2017/18 estimates in its World Agricultural Supply and Demand Estimates (WASDE) report. "We saw some follow through selling (from Thursday) and they seemed to dry up and ended up pretty decent ... We have got some help from the charts with support at 83.30 cents," said Jack Scoville, vice president with Price Futures Group in Chicago.
"The fact of the matter is that there is demand overall and the export sales numbers have been great ... Need to see how the acreage and production is going to be for next year to see how the prices are going to be supported from here."
Weekly export sales data from the USDA on Thursday showed exports totaled 510,500 running bales (RB) for the week ended May 3, up 18 percent from the previous week and 19 percent from the prior 4-week average. Net upland sales of 193,100 RB for 2017/2018 were up 2 percent from the previous week.
The December contract settled mostly up at 80.24 cents. "For more clarity on December, we got to see how we get the crop on the ground. It is still very dry in West Texas right now. There is a problem here. We need to see a much better weather. If that happens, then we could see more people switching from wheat," Scoville said.
Speculators again upped a bullish bet in cotton contracts on ICE Futures US in the week to May 8, as they reduced their bullish stance in cocoa futures and options, US Commodity Futures Trading Commission data showed. Total futures market volume fell by 5,088 to 29,865 lots. Data showed total open interest fell 595 to 285,724 contracts in the previous session. Certificated cotton stocks deliverable as of May 10 totaled 73,464 480-lb bales, down from 74,260 in the previous session.
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