Cotton futures finished Tuesday at a fresh 15-week low on switch sales and the market could slip further as players scramble to get out of July before it goes into delivery two weeks hence, traders said. The New York Board of Trade's July contract fell 0.43 cent to conclude at 46.94 cents a lb, moving from 46.85 to 47.65 cents. It was the lowest close for cotton on a spot basis since trading around 46.50 cents in mid-February.
New-crop December slid 0.57 to 50.95 cents.
Losses in the back months ranged from 0.25 to 0.65 cent.
Keith Brown of commodity firm Keith Brown and Co. in Moultrie, Georgia, said continued to see "the exodus of the specs out of July" and that more speculative liquidation is likely before the contract goes into its delivery period after June 24.
The market is also being pressured by the lingering "textile rumblings" between the United States and China, now the world's biggest cotton consumer, Brown added.
But most of the running in the market was in switch trade. Open interest in the July contract fell 1,517 lots to 52,332 contracts as of June 6 while interest in the December contract rose 1,266 to 31,497 lots.
The weekly New York Board of Trade spec/hedge report showed the funds with a net long position of 16.8 percent, versus a net long last week of 22.6 percent.
"The trend-following funds are probably flat to slightly short the market now, while the index funds remain long," said a daily commentary by brokers Flanagan Trading Corp
Mike Stevens of SFS Futures in Mandeville, Louisiana, added that "Given the relatively slight drop in open interest and the huge percentage of longs rolled forward, it is certainly in line and should be no surprise."
Most market players are also keeping an eye on the development of cotton crops in the United States and in China, analysts said.
Flanagan Trading sees support in the July contract at 46.30 and 45.60 cents, with resistance at 47 and 47.80 cents.
Floor dealers said estimated final trading volume hit 26,000 lots, from the prior 17,961 lots. Open interest in the market rose 32 lots to 94,057 lots as of June 6.