Reuters | 15 March 2019
NEW YORK: ICE cotton futures slipped nearly 2 percent on Thursday, hit by concerns that a trade pact between the United States and China would be delayed, as well as a firmer dollar. The most active cotton contract on ICE Futures US, the May contract, settled down 1.42 cents, or 1.88 percent, at 74.30 cents per lb. The contract traded within a range of 74.02 cents and 75.88 cents per lb.
“There is a perception that a US-China trade agreement will be pushed back further to end-April, so that disappointed the market,” said Keith Brown, principal at cotton brokers Keith Brown and Co in Moultrie, Georgia, adding a stronger dollar was also weighing on the prices.
A meeting between US President Donald Trump and China’s Xi Jinping won’t take place in March and was more likely to take place in April at the earliest, Bloomberg reported citing unnamed sources. The report comes a day after Trump said he was in no rush to complete a trade pact with China.
The US dollar gained on Thursday for the first time in a week, with the dollar index up 0.2 percent. A stronger greenback makes commodities priced in dollars such as cotton more expensive for holders of other currencies. Data from the US Department of Agriculture showed net sales of 166,100 running bales in the 2018/19 marketing year for the week ended March 7.
Total futures market volume fell by 9,401 to 29,514 lots. Data showed total open interest gained 675 to 221,665 contracts in the previous session. Certificated cotton stocks deliverable as of March 13 totalled 111,207 480-lb bales, down from 112,289 in the previous session.—Reuters
(Source: Business Recorder)