Cotton hits over one-month low on strong dollar, lower oil
July 22 (Reuters) -ICE cotton futures fell to a more than one-month low on Monday, weighed down by a stronger dollar, falling oil prices, coupled with concerns over demand from China.
* Cotton contracts for December CTZ4 fell 0.51 cent, or 0.72%, to 70.19 cents per lb at 11:09 a.m. EDT(1509 GMT), having marked its lowest level since June 17, earlier in the session.
* "Demand is still an issue. Export sales report last week wasn't anything really too terribly strong, and we're still worried about what China will do, even though they've been taking a little bit here," said Jack Scoville, vice president at Chicago-based Price Futures Group.
* "The crops looking pretty good out there and that's probably the biggest thing going on. Condition ratings happen deteriorating, but should be stable maybe a little better here this week," said Scoville.
* Last week, the U.S. Department of Agriculture's weekly report showed sales export sales of 113,100 running bales (RB) on Thursday, were down 30% from the previous week and 33% from the prior 4-week average. EXP/COT
* The report also showed net sales of Upland cotton totaling 27,200 RB for 2023/2024, a marketing-year low, were down 50% from the previous week.
* The dollar .DXY rose for a third straight session, making cotton more expensive for overseas buyers.USD/
* Weighing on the natural fiber, oil prices fell on Monday after Joe Biden announced he would not seek a second term as U.S. president, while investors considered the possibility of U.S. interest rate cuts, potentially as soon as September. O/R
* Lower oil prices make cotton-substitute polyester less expensive.
* Cotton speculators trimmed their net short position by 631 contracts to 44,491 in the week to July 16. CFTC/
Reporting by Anmol Choubey in Bengaluru; Editing by Shailesh Kuber
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
