ICE cotton climbs amid strong market fundamentals, slow acreage in US

According to trade analysts, the US cotton July contract settled 256 points higher at 80.06 cents per pound (0.453 kg). The December contract settled at 77.70 cents, up 195 points on Wednesday. However, ICE cotton was traded with losses on Thursday.

Yesterday, the dollar index was steady and settled with mild gains. Although cotton received some demand due to nearly yearly low prices. Crude oil prices showed significant recovery yesterday, rising about 2 per cent, which supported the cotton rally.

The US cotton market has indicated that the prices are getting bottomed out. During the last four sessions, the most active contracts have closed higher in three sessions.

The market noted a higher volume of trade on Wednesday. The trading activity surged with a volume of 60,467 contracts, making it the most active session in the last 14 sessions. Certified stocks commenced at 168,770 bales yesterday, witnessing a reduction of 16,020 bales.

Today, US cotton sales data will be released, which will provide insights about current demand. The WASDE report will also be announced this week, which will have larger implications on world cotton markets.

On Thursday, ICE cotton July 2024 was traded 1.21 cents lower at 78.85 cents per pound. Meanwhile, cash cotton was traded at 75.81 cents (up 2.56 cents), the October (new crop) contract at 79.00 cents (up 0.06 cent), the December 2024 contract at 76.48 cents (down 1.22 cents), March 2025 at 78.11 cents per pound (down 1.08 cents), and May 2025 at 79.24 cents (down 1.03 cents).

Fibre2Fashion News Desk (KUL)