Cotton futures ended easier on Thursday on fund sales as the market followed other commodities which rose early and then reeled late because investors remained gloomy about economic prospects, brokers said. The benchmark December cotton contract fell 0.66 cent to close at 60.76 cents per lb, trading from 59.45 to 63.18 cents.
On Tuesday, the contract finished at 60.61 cents. Based on the second position daily charts, it was the lowest close for the contract since September 2007. March declined 0.64 cent to 65.34 cents. Volume traded in the December contract stood at 23,033 lots at 2:42 pm (1842 GMT). "We're just struggling to keep the losses (to a minimum)," said Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana.
"It's chaotic," he said, describing action in the cotton market. "The ingredient missing today is stability." Cotton followed other markets in early action, but once futures from grains to oil began slipping, fibre contract investors lost heart and sold it off late, dealers said.
Stevens said the close over 60.35 cents, a level representing yesterday's low, should encourage the market to grind higher. Traders said there was initial encouragement stemming from larger-than-expected US cotton sales in the weekly export sales report of the US Agriculture Department.
USDA said total US cotton sales hit 475,000 running bales (RBs, 500-lbs each), from 161,000 RBs last week and trade expectations it would range from 150,000 to 250,000 RBs. US cotton export shipments stood at 289,600 RBs, from 235,300 RBs and trade belief it would run from 220,000 to 240,000 RBs.
Brokers Flanagan Trading Corp sees support in the December contract at 60.25 and 59.40 cents, with resistance at 61 and 62.90 cents. Volume traded in the cotton market Wednesday was 19,850 lots, exchange data showed. Open interest in the cotton market fell 1,310 lots to 214,140 contracts as of September 17, it added.