ICE cotton futures dipped on Tuesday after sharp losses the prior session amid uncertainty over whether recent rains in Texas, the top-growing US state, would ultimately be harmful or beneficial to the crop. “Nobody knows how many acres are going to be lost and whether the remaining acres will make up for it. Everybody’s still in that guessing game,” said Peter Egli, director of risk management at British merchant Plexus Cotton Ltd.
Cotton contracts for July settled down by 0.15 cent on Tuesday, a 0.2 percent loss, at 63.60 cents per pound. It traded within a range of 63.33 and 64.29 cents a pound. Cotton contracts for December settled down by 0.01 cent at 64.06 cents a lb. US Department of Agriculture data published Monday after market close showed US farmers had planted 61 percent of their intended cotton acreage as of May 31, up from 47 percent the prior week but below 72 percent at the same point the previous year.
The December contract’s premium to the July contract rose to 0.46 cent per lb up from 0.32 cent per lb in the prior session. Total futures market volume fell by 9,710 to 23,517 lots. Data showed total open interest fell 1,162 to 188,508 contracts in the previous session. Certificated cotton stocks deliverable as of June 1 totalled 134,005 480-lb bales, up from 132,772 in the previous session. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was up 1.05 percent. The Relative Strength Index in the most-active contract rose to 43.943.