Vietnam was the main exception to this negative trend, as its imports were raised by 0.1 million to 3.4 million bales. Vietnam is an amazing success story, as it has more than doubled its imports since 2011/12 and is now the fourth largest cotton importer after China, Bangladesh and Turkey.
Led by a strong December that rallied 264 points to close at 68.09 cents, New York cotton futures trended higher this week.Nearby supply worries and #
The latest US export sales report was not what traders were expecting, as China cancelled 105,300 running bales net, more than offsetting the 75,700 running bales of Upland and Pima that were sold to 15 other markets.
“These disappointing export sales numbers we are seeing week after week are primarily due to a lack of offers, since the US pipeline is empty and there are already 5.2 million bales in export sales on the books”, Plexus says.
Most shippers are therefore reluctant to increase their commitments before the outcome of the US crop is known, especially with all this cool and wet weather lingering around.
A constructive technical picture has been triggering spec buying, which has lifted December above 68 cents on Friday for the first time in seven weeks. Based on the chart one should see additional strength in the sessions ahead.
This rise should help to flush cotton out of grower hands and/or prompt producers to buy some price insurance, both of which will create resistance on the way up.
However, barring any major setbacks on the production side, the longer-term outlook remains bearish, as ROW stocks are expected to increase to 43.4 million bales and import needs keep falling. (AR)
Fibre2fashion News Desk - India