Cotton futures settled easier on Wednesday on speculative sales as the market consolidated near its recent lows while waiting for direction from a government sales report and the grains market, brokers said.
ICE Futures' open-outcry March cotton contract eased 0.11 cent to end at 66.91 cents per lb, trading between 66.80 and 67.25 cents. Based on the spot daily closing charts, it was the lowest finish for cotton in three weeks.
May cotton shed 0.16 to 68.64 cents. The new-crop December cotton contract lost 0.22 to 75.34 cents. The March electronic cotton contract eased 0.05 cent to 66.97 cents at 2:52 pm EST (1952 GMT), dealing from 66.70 to 67.37 cents.
"We're drifting along. We're held hostage by the volatility or non-volatility of the grains markets," said Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia.
The cotton market had taken its cue from grains because rallies in soybeans and wheat among others would prompt American cotton farmers to switch to beans or grains. Fundamentally, the market is looking toward release of the US Agriculture Department's weekly export sales report.
Brokers believe total US cotton sales would range from 150,000 to 250,000 running bales (RBs, 500-lbs each), from sales last week of 319,800 RBs. They expect total US cotton shipments to range from 200,000 to 220,000 RBs, against shipments last week of 202,300 RBs.
Brokers Flanagan Trading Corp sees resistance in the March open-outcry cotton contract at 67.75 and 68.60 cents, with support at 66.50 and 65.80 cents. Open-outcry volume Tuesday was at 8,665 lots and screen business was at 31,860 lots. Open interest in the cotton market fell 4,040 lots to 266,923 lots as of February 12, exchange data showed.