ICE cotton slides, weak dollar fails to support sentiments

According to market data, the ICE July contract reached a new low of 80.91 cents per pound (0.453 kg), finally settling at 81.33 cents. Open interest continued to decline. The December 2024 contract also touched 78.32 cents before settling at 78.54 cents. However, ICE cotton regained ground in most of the contracts during today's session.

Market analysts noted that the US dollar index remained down, finally settling below 106. Buyers did not show interest in cotton despite the currency devaluation. A weaker dollar made cotton cheaper for foreign buyers. Crude oil slipped more than two per cent yesterday, negatively impacting cotton as weak crude oil prices make polyester staple fibre, a close competitor of cotton, cheaper.

ICE cotton certified stocks rose again, reaching 171,700 bales, which was the highest number of the season. Traders are focusing on the export sales report to be released by the USDA this evening. It will indicate the export demand for the natural fibre. If the demand remains weak, ICE cotton may see further lows.

During today’s session, ICE cotton for May 2024 was traded 0.11 cent lower at 79.50 cents per pound. Meanwhile, cash was traded at 77.08 cents (-0.11 cent), July 2024 at 81.51 cents (+0.18 cent), the October (new crop) contract at 79.06 cents (+0.01 cent), the December 2024 contract at 78.58 cents (+0.13 cent), and the March 2025 contract at 79.94 cents per pound (+0.10 cent).

Fibre2Fashion News Desk (KUL)