Mumbai, 03 Dec (Commoditiescontrol): ICE cotton futures dropped to a one-week low on Monday, weighed down by a stronger U.S. dollar and bearish trends in the grains market.
The benchmark March cotton contract declined by 44 points to settle at 71.49 cents per pound. However, contracts for May and July edged higher, closing at 72.65 cents and 73.57 cents, respectively, signaling some resilience in the broader market.
The cotton market faced mixed external pressures, with the U.S. dollar index rising sharply, making dollar-priced commodities less competitive, while crude oil prices ticked up marginally. Despite these challenges, the March contract posted a modest 10-point rise for November, reflecting steady market fundamentals.
The U.S. Department of Agriculture’s (USDA) weekly export sales report brought some optimism. Sales of upland cotton for the 2024/25 marketing year hit a seasonal high of 324,100 running bales (RB), marking a 2% increase week-on-week and a 46% jump compared to the four-week average. Major buyers included Pakistan and Vietnam, which together accounted for 61% of total sales. However, shipments dipped to 130,318 RB but remained significantly higher year-over-year.
In production updates, the USDA’s Cotton Ginnings report showed 2.157 million RB processed in the first half of November, bringing the seasonal total to 6.852 million RB, up 20% from last year. Harvesting activities across U.S. cotton fields progressed to 84% completion, surpassing the five-year average of 80%.
Global competition continues to impact U.S. cotton prospects, with Brazil gaining a competitive edge in key export markets. The USDA revised its cotton production forecast for the 2024/25 season to 5.2 million bales, a sharp 28% decline from the previous year. This decline reflects reduced harvested acreage and lower yields, especially in Punjab province.
Market participants remain cautious about potential volatility, with traders closely monitoring support levels for the March contract at 70.56 and 69.63 cents and resistance at 72.24 and 72.99 cents. Sustained export demand and global trade dynamics will be critical drivers in the coming weeks.
Meanwhile, the Cotlook A Index held steady at 82.00 cents per pound, and the USDA Adjusted World Price (AWP) was raised by 162 points last week to 57.53 cents per pound, further shaping market sentiment.
(By Commoditiescontrol Bureau: 09820130172)
0 Comments 
Post Comment 
