The benchmark cotton contract on ICE Futures US settled up 3 cents, or 3.79 percent, at 82.18 cents per lb., the highest since June 2014. "Mills with unfixed sales were caught out by tightening US supplies and bullish speculators," said Gabriel Crivorot, analyst at Societe Generale in New York.
"This week, there are reports of tightening stocks in the US, as exports have recovered from a few disappointing weeks. Additionally, funds have been increasing their net long position to near record highs again, even as prices had been falling." Weekly export sales data from the US Department of Agriculture (USDA) on Thursday showed net upland sales for the 2016-17 crop last week totalled 160,600 running bales, up 5 percent from the week before.
"It's just one of these bizarre things where the market is trying to ration a small carry-up," said Rogers Varner, president of Varner Brokerage in Cleveland, Mississippi. "This is a process the market has to go through in order to get some cancellations." The July cotton contract on ICE Futures US settled up 3 cent, or 3.79 percent, at 82.18 cents per lb. It traded within a range of 79.15 and 82.18 cents a lb. The contract rose about 5.7 percent this week, the highest since mid-July.
The dollar index was down 0.42 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was up 0.69 percent. Total futures market volume fell by 11,077 to 54,652 lots. Data showed total open interest fell 1,529 to 252,511 contracts in the previous session. Speculators cut their net long position in cotton in the week to May 9, by 2,595 contracts to 96,210, US Commodity Futures Trading Commission data showed on Friday.
Copyright Reuters, 2017