Cotton futures down over 3% on strong annual acreage report
Adds details from USDA acreage report, quotes
June 28 (Reuters) -ICE cotton futures fell more than 3% on Friday, weighed down by a robust annual acreage report from the U.S. Agriculture Department (USDA) indicating increased planted area for the natural fiber.
* Cotton contracts for December CTZ4 fell 2.34 cent, or 3.14%, to 72.24 cents per lb at 12:44 p.m. ET (1643 GMT), hitting its lowest since June 21.
* The annual acreage report from the USDA estimated a 14% increase in total cotton planted area for 2024, reaching an estimated 11.7 million acres, including an uptick in Upland area to 11.5 million acres, marking a 14% rise compared to 2023.
* "The acreage number is bearish... And it looks like the only issue now is with the high amount of acres planted in Texas," said Rogers Varner, president of Varner Brokerage in Cleveland, adding that it also depends on the harvest.
* "The last few years, they've gotten off to a good start, and often they end up taking the insurance option or abandoning the acreage all together," Varner said.
* Cotton prices were set for a third consecutive monthly decline, while also eyeing a quarterly fall of around 14%.
* The weekly USDA report showed export sales of 141,000 running bales (RB), down 29% from the last week. EXP/COT
* The report also showed net sales of 90,600 RB for 2023/2024, down 52% from the previous week.
* While cotton might be bearish early next week, the weather factor will dominate the price after July 4 and for the rest of the summer, Varner said.
* In the wider agricultural market, Chicago wheat saw its first weekly increase in a month but was still heading for its largest monthly drop since 2022.
* Meanwhile, corn and soybeans have seen some gains, but are likely to record weekly losses. GRA/
Reporting by Anmol Choubey in Bengaluru; Editing by Shailesh Kuber and Vijay Kishore
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