ICE cotton futures edged up on Friday as investors covered short positions, but prices traded not far from a two-week low touched earlier in the session on expectations of robust crop and faint demand. The most-active cotton contract on ICE Futures US December was up 0.43% at 60.54 cents per lb as of 1:46 pm EDT (1746 GMT). It traded within a range of 59.58 and 60.65 cents a lb.
"We basically have seen the funds get extremely short. We are (now) going to the end of the quarter and month, and buying positions based on end-of-quarter - funds are leveling up every time we dip," said Jobe Moss, a broker with MCM Inc in Lubbock, Texas. The most-active contract is on course for its second straight quarterly fall of about 8%, but set for its first monthly gain in six. "Overall we are going to have big crop ... and see a lot of selling with the large harvest," Moss said, adding the market is going to be locked in the current range until the demand ticks up.
Cotton prices have traded within a 3-cent range in the past two weeks. Total futures market volume fell by 1,433 to 15,344 lots. Data showed total open interest gained 436 to 234,731 contracts in the previous session.