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ICE Cotton Prices Fall; U.S.- China Trade Tension Sours Post Holiday Mood

30 Nov 2019 6:43 am
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MUMBAI (Commoditiesontrol) – ICE cotton futures slipped on Friday in thin-volume trade a day after the U.S. Thanksgiving holiday due to uncertainty over a trade deal between the United States and China weighing on investor sentiment.

Cotton contract for March settled down 0.45 cent, or 0.68%, at 65.36 cents per lb. It traded within a range of 65.11 and 65.78 cents a lb.

December 2020 closed at 66.84 cents, down 0.80 cent. Estimated volume was 15,345 contracts.

This is indicative of the fact that the cotton market clearly ignored a very welcome weekly sales and export number. The U.S. Department of Agriculture in its weekly export-sales report showed net sales of 281,500 running bales (RB) for the 2019/20 marketing year, up 24% from the previous week and up 33% from the prior four-week average, for the period ended Nov. 21.


Although, for the week, March cotton managed to go up 0.51 cent, and for the month of November it was off 0.52 cent. So far for the year, March cotton is down 8.90 cents. Friday, spot December finished at 64.40 cents, down 0.51 cent.

Market experts attribute zero progress over the Trade front between the U.S and China as the reason behind slide in cotton prices. U.S. President Donald Trump signed legislation on Wednesday that threatens sanctions for human rights violations on China, while China on Thursday threatened to retaliate.

The natural fiber has fallen over 11% so far this year on the backdrop of the protracted trade war between the United States and China.

Traders are unhappy about their cotton deals with China not being shipped due trade war scenario.

Total futures market volume fell by 2,612 to 14,204 lots. Data showed total open interest gained by one to 199,012 contracts in the previous session. Certificated cotton stocks deliverable as of Nov. 29 totaled 83,666 480-lb bales, up from 78,124 in the previous session.

Support for March contract is 63.75 cents/lb and resistance is 67.15 cents/lb.

(By Commoditiescontrol Bureau)



       
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