Mumbai, 11 Nov (Commoditiescontrol): Cotton futures on the Intercontinental Exchange (ICE) closed slightly lower on Friday, capping a week marked by economic headwinds and a mixed USDA report. However, December cotton futures managed to secure an 81-point gain for the week, equating to a 1.15% rise from the prior week—a sign of resilience amid challenging conditions.
For the week, December cotton futures settled at 70.98 cents per pound, down by 0.07 cents on Friday’s close. March and May contracts concluded at 73.25 and 74.59 cents per pound, respectively. The cotton market faced downward pressure from declining crude oil prices, which dropped $1.85 per barrel, as well as a strengthening U.S. dollar, which climbed 460 points. Nevertheless, the U.S. economy's robust outlook—boosted by favorable policies on job repatriation, low interest rates, and export support—provided some optimism for cotton’s demand potential.
Harvesting of U.S. cotton crops has also advanced, with 63% of the crop harvested, which is notably 9% faster than the seasonal average. Recent Cotton Ginnings data reported a two-week processing total of 2.402 million running bales (RB) as of November 1, taking the season’s tally to 4.696 million RB, the highest in five years. Export bookings of upland cotton hit a season-high of 229,039 RB in the week ending October 31. However, U.S. cotton production forecasts were slightly lowered to 14.19 million bales, and export projections were cut by 200,000 bales to 11.3 million, causing an increase in ending stocks by 200,000 bales to 4.3 million.
Despite strong bookings, export shipments totaled 145,832 RB for the week—the third-highest this marketing year—bringing cumulative commitments to 5.892 million RB, or 55% of the USDA’s export target, lagging behind the typical pace of 66% by this point in the season. The USDA also reduced the Adjusted World Price (AWP) by 58 points, setting it at 57.96 cents per pound.
Additional market insights reveal that online cotton sales on The Seam recorded 6,272 bales at an average price of 69.11 cents per pound on November 7. The Cotlook A Index eased 20 points to 82.00 cents, while managed money speculative funds slightly reduced their net short positions by 268 contracts, bringing the total to 10,917 contracts as of November 5.
Looking ahead, analysts anticipate continued volatility in cotton futures as markets respond to recent U.S. election outcomes and upcoming USDA forecasts. For December cotton futures, key technical support levels are at 70.21 and 69.43 cents, while resistance is expected around 71.56 and 72.13 cents. These parameters may define cotton's near-term movement as market participants closely monitor both domestic and global cues.
(By Commoditiescontrol Bureau: 09820130172)
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