Home / Knowledge / News / Textiles / NY cotton futures steadily moves higher this week
NY cotton futures steadily moves higher this week
05
Oct '13
Weather remained the dominating feature in the cotton market this week, as storms continue to threaten open fields all over the globe. A couple of days ago untimely rains fell in Turkey and over the coming weekend two tropical systems are expected to bring heavy rainfall to cotton areas in the US and China.

Tropical storm “Karen” is on track to make landfall somewhere along the Alabama coast on Saturday, bringing gusty winds and possibly heavy downpours to the US Southeast, all the way from Alabama to North Carolina. Unfortunately the system seems to be a slow mover and may get mixed up with a cold front moving in from the Rockies, which has the potential to produce quite a bit of rain.

On the other side of the globe we have Typhoon “Fitow”, which is forecast to make landfall in China’s Zhejiang Province on Sunday, bringing potentially torrential rainfall to cotton areas in Jiangsu, Anhui, Henan and Shandong. Some models predict 4-8 inches of rain near the coast and 2-4 inches inland, which may impact both yield and quality.

While crops can handle an isolated rain event, the market is afraid that a recurring pattern of wet and cool conditions could make it difficult to get these already late Northern Hemisphere crops off the field and it may also reduce the availability of high grades. That’s why the market is currently pricing in a ‘weather premium’, which will likely be there for another four to six weeks.

Another interesting feature this week has been the big increase in open interest, as a total of 23’298 new longs and shorts were added over the last six sessions. Total open interest amounted to 205’751 contracts as of this morning, the highest level since the failed breakout attempt seven weeks ago, when it reached 214’378 contracts on August 19.

While new shorts are probably linked to hedge selling by the trade (Brazil, Australia, on-call sales), we have some difficulty explaining the sudden jump in new longs. We can’t see any compelling technical reasons that would have prompted spec longs to enter the market in big numbers.

Trade short covering doesn’t seem to be a likely cause either, since that would have led to a decline in open interest, although it is possible that some of these shorts bought bullish options strategies to safeguard their positions in view of all these weather worries.

Must ReadView All

Textiles | On 28th Apr 2017

Fix 5% GST rate for textile goods: Textile bodies

Uniform levy of 5 per cent Goods and Services Tax (GST) on all...

Textiles | On 28th Apr 2017

India lifts CVD imposed on Nepali Jute goods

The countervailing duty (CVD) that was imposed on Nepali jute...

Courtesy: Williamsburg Garment Company

Fashion | On 28th Apr 2017

'We have grown by staying small & maximising efforts'

The easiest way to go out of business is to be too big or expand too...

Interviews View All

Md Hanifur Rahman
Aman Group

The level of understanding the job role and organisational requirements...

Angelina Francesca Cheang
MY ANJE

'Consumers in the age-group 21 to 38 are driving the activewear trend'

Jurgen Gauger
Spreadshirt

‘Buying crowdsourced or creative designs are much more appealing to the...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
April 2017

April 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search



X