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  • Aug 3rd, 2004
  • Comments Off on New York cotton closes tad firmer in light trade
New York cotton futures crawled to a marginally higher close Monday on speculative and options-related buying, but volume was light and bearish fundamentals are seen keeping fiber contracts on a tight leash in the days ahead, brokers said.

Key December cotton increased 0.36 cent to conclude at 44.76 cents a lb, ranging between 44.25 and 45.19 cents. March added 0.33 to 46.10 cents. Except for two months, the rest were flat to 0.47 cent higher.

Frank Weathersby of brokers Affinity Trading in Fort Walton Beach, Florida, said cotton managed a slight rebound, but there was little in the way of news to give futures direction for a sustained move.

Futures have been pressured by news of ideal growing weather in the US cotton belt. Production in countries like China, the worlds biggest producer and consumer of cotton, is also expected to rise this year.

Last week, the US Food and Agricultural Policy Research Institute said American farmers will likely harvest 18.8 million (480-lb) bales of cotton, the fifth largest crop on record.

The market paid little heed to news of a deal in Geneva that rich and poor nations will work toward slashing farm subsidies.

"They agreed to cut, but theirs a lot of hard fighting ahead on where the cuts would fall," an analyst said. Brazil and African nations have attacked US cotton subsidies for distorting the world market and depressing prices.

Brokers Flanagan Trading Corp pegged support in the December contract at 44.50 and 43.80 cents, with resistance at 45.50 and 46 cents.

Floor dealers said estimated final volume amounted to 5,500 contracts, up from Fridays tally of 10,572 lots. Open interest rose 579 lots to 79,808 lots as of July 30.

Copyright Reuters, 2004


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