Cotton extends losses on demand concerns, lower oil and grains
Aug 6 (Reuters) -ICE cotton futures extended their losses from the previous session on Tuesday, pressured by falling oil prices and weaker grain markets, while demand concerns further weighed on the natural fiber amid promising production outlook.
* Cotton contracts for December CTZ4 fell 0.32 cent, or 0.47%, at 67.46 cents per lb at 12:28 a.m. EDT (1628 GMT).
* Cotton prieces dipped to their lowest level in nearly four years on Monday.
* "Generally there's concerns about world economic conditions, we could be falling into a recession and the cotton demand overall," said Jack Scoville, vice president at Chicago-based Price Futures Group.
* Oil prices dipped lower in volatile trade on Tuesday, as a weak demand outlook after a global sell-off in markets on Monday countered price support from fears of an escalation in the Middle East conflict, and a drop in Libyan production. O/R
* Lower oil prices make cotton-substitute polyester less expensive.
* Weighing on the natural fiber, Chicago corn, wheat and soybean futures fell on Tuesday as weekly U.S. crop data underscored good harvest prospects while grain prices were also curbed by a stronger dollar as financial markets recovered from the previous day's slide.GRA/
* The hurricane isn't impacting cotton and the production looks promising due to good growing conditions, said Scoville, adding that prices might remain stable or drop, with an attempt to maintain above 67 cents and if it fails, it could drop to 65 cents.
* In a weekly crop progress report on Monday, the U.S. Department of Agriculture (USDA) said 45% of the cotton crop was in good-to-excellent condition, compared with 49% a week ago.
* The situation in Bangladesh may influence prices; it's an important market and despite political turmoil in the country, demand is assumed to remain intact for now, but that may change, added Scoville.
* Bangladesh's president dissolved parliament on Tuesday, clearing the way for an interim government and new elections a day after Prime Minister Sheikh Hasina resigned and fled following a violent crackdown on a student-led uprising.
Reporting by Anmol Choubey in Bengaluru; Editing by Mohammed Safi Shamsi
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