cotton futures news

cotton futures news

October 18th, 2018
The USDA World Agricultural Supply and Demand Estimates for October contained a couple of surprises. The revisions of the 2018/19 world cotton numbers included a large — and long-awaited — revision to India’s historical balance sheets covering 2002-2013 crops.

For the 2018/19 balance sheet, this was reflected by a 2.9 million-bale month-over-month reduction to Indian carry-in stocks. This cut went straight to the bottom line, reducing Indian and foreign ending stocks. World production was cut 310,000 bales, mainly from a half-million bale reduction in Australia that outweighed smaller increases elsewhere. World consumption was reduced by 180,000 bales, mainly in Turkey.

The bottom line of all these adjustments was a fundamentally bullish 3.01 million bale reduction in world ending stocks, month-over-month.

The October revisions to 2018/19 U.S. cotton involved another surprising, albeit small, increase in U.S. supply. This adjustment was attributed to production increases in Texas and Georgia (pre-Hurricane Michael) that outweighed post-Hurricane Florence reductions in the Carolinas. U.S. 2018/19 exports were reduced by 200,000 bales to reflect lower world trade and consumption.

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cotton futures news

cotton futures news

April 3rd, 2018
Cotton prices will edge up to their higher in five years next season, the International Cotton Advisory Committee forecast, as it cut its forecast for inventories to the lowest since 2011-12.


The intergovernmental group, in its first forecast for cotton prices in 2018-19, which starts in August, saw them averaging 84 cents a pound, as measured by the Cotlook A index of physical values.


That would represent a small improvement from the price expected for this season, which Cotlook hiked by 5 cents a pound to 83 cents a pound.


The group failed to elaborate on the reasoning behind the upgrade, although it follows consistently higher prices than many commentators had envisaged earlier in the season, with the Cotlook A closing last week at 89.95 cents a pound.


The 84 cents-a-pound cotton price the ICAC forecast for next season would also be the highest since 2013-14, when prices averaged 91 cents a pound, before tumbling to 70 cents a pound two seasons later as China curtailed imports and focused on drawing down bloated state inventories.


Cotton Futures: ‘Environmental damage’


The ICAC’s price forecast came as it trimmed by 220,000 tonnes, to 17.93m tonnes (82.4m bales), its estimate for cotton inventories at the close of 2018-19.


Stocks at that level would be the lowest since 2011-12, when US inventories were recovering from a 20-year low.


The committee, highlighting a “positive” short-term outlook for the cotton market, flagged the prospect of accelerating growth in demand for the fibre, seen increasing by more than 1.1m tonnes next season, after an 880,000-tonne rise in 2017-18.


“Consumption – which has steadily increased over the last three seasons – is expected to continue rising,” the ICAC said.


It noted factors including “the rising production costs of synthetic fibres and growing awareness of the environmental damage being caused by microfibre pollution”.

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cotton futures news

cotton futures news

December 15th, 2015

Cotton will be “one of the worst performing” agricultural commodities next year, Australia & New Zealand Bank said, warning that the latest drop in oil prices had only enhanced the competitiveness of synthetic fibres.

ANZ recommended a “sell” trade on New York cotton futures, saying that the relative stability of the market over the past two months, after recovering from a dip below 60 cents a pound in September, had lulled investors “into a false sense of security”.

In fact, an increase by hedge funds to a net long position of more than 60,000 contracts in New York cotton futures and options, as revealed by regulatory data on Friday, had only enhanced the prospect for selling pressure once it was unwound.

This net long – the extent to which long bets, which profit when values rise, exceed short holdings, which benefit when prices fall – was the highest in 19 months, and enhanced the idea of the fibre being “overbought”, the bank said.

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cotton futures

cotton futures

August 7th, 2014

Cotton production in Australia is set to plummet as much as 50 percent next season as drought curbs water supply in the world’s third-biggest exporter, according to growers and shippers.

Output may be between 2 million and 2.5 million bales in 2014-2015 from about 4 million bales this year, according to Cotton Australia, the Sydney-based producers’ group. Production may total about 2.25 million bales, according to the Australian Cotton Shippers Association, which promotes exports. An Australian bale weighs 227 kilograms (500 pounds).

Cotton futures slumped 24 percent this year and are the biggest losers in the Bloomberg Commodity Spot Index as output in the U.S., the largest exporter, is poised to climb, adding to record global reserves. Australian farmers may plant less after a record drought in Queensland and dry conditions in parts of New South Wales, the biggest producer, according to Cotton Australia Chief Executive Officer Adam Kay.

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cotton futures

cotton futures

August 03, 2014

Cotton futures rose on Friday, as bargain hunting by cotton mills and short-covering by investors lifted the fibre market from a five-year low after three days of declining prices. The most-active December cotton contract on ICE Futures US finished up 0.4 cent at 63.27 cents a lb. The session low was 62.02 cent, the lowest since October 2009 for a benchmark second month contract in US cotton on a continual basis.

December cotton has lost 33 percent over the past two months as investors dumped futures on fears of excess supply. “We’re getting to a point where the mills are stepping up to buy fibre here,” said Jack Scoville, vice president at Price Futures Group in Chicago. ‘If you’ve been short for a while, you’re taking some money off the table here,” he said.

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cotton futures

cotton futures

July 24th, 2014

Cotton production in India, the world’s second-largest grower, is set to climb to an all-time high as delays in monsoon rains prompt farmers to switch from soybeans and peanuts, the nation’s biggest cotton trader said. Futures in New York fell.

The harvest is poised to expand as much as 2.6 percent to 40 million bales of 170 kilograms (375 pounds) each in the year starting Oct. 1, according to B.K. Mishra, chairman of the Cotton Corp. of India. While the area is increasing from 11.7 million hectares (28.9 million acres), the harvest will be delayed by the worst start to the monsoon since 2009, he said. Cotton Corp. buys the crop at government-set minimum prices.

Cotton futures have dropped for 11 straight weeks in New York, capping the longest slump in 55 years, on concern that global inventories are climbing as demand slows from China, the largest user. A higher crop in India, the top shipper after the U.S., may curb any rally in prices that fell 20 percent in 2014.

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cocoa futures brokers

Cocoa premium soars

May 13th, 2013

Cocoa Futures – The premium cocoa for May delivery commands over the July futures tripled on speculation supplies in Europe will be limited before the May contract expires.

Cocoa for May delivery was 42 pounds ($54.53) a ton more expensive than the July futures by 12:58 p.m. in London on NYSE Liffe, up from 13 pounds on May 10 and compared with a discount on May 8. The May contract ends trading on May 15 and the delivery will be the next day.

“The spread should stay firm until the last trading day on speculation of limited supplies in European warehouses,” Jerome Jourquin, head of agricultural commodity derivatives at Aurel BGC in Paris, said by e-mail today.

Prices for near-dated contracts that are higher than later ones is a market situation known as backwardation and may signal limited supplies. The May contract rose 27 pounds and the July contract was down 1 pound.

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cocoa futures trading news

cocoa futures rebound

April 23rd, 2013

Cocoa futures rebounded in London on speculation producing nations in West Africa, the main growing region, have sold a lot of their crops, removing some hedging pressure from futures markets. Coffee and sugar slid.

Producing countries may have sold up to 250,000 metric tons of cocoa in the past 10 to 15 days, according to London-based futures and options brokerage Marex Spectron Group. Prices fell as much as 1.3 percent in London yesterday as money managers boosted bets on higher prices to this year’s high in the week ended April 16, leaving the market vulnerable to liquidation.

“Cocoa collapsed yesterday because speculators bought more -mostly covering shorts- than initially thought,” Eric Sivry, head of agriculture options brokerage at Marex Spectron, said by e-mail today. “With origins having sold a lot recently, selling pressure has been slightly removed.”

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coca futures trading news

cocoa futures move higher

April 19th, 2013

Cocoa futures, already headed for their biggest monthly gain since August, probably will advance further to the highest since early December, according to a technical analysis by John Caruso at RJO Futures.

Cocoa prices on ICE Futures U.S. in New York are sending bullish signals after surging above the 50-day moving average of $2,149 a metric ton on April 8 and then the 100-day average of $2,246 three days later, Caruso said. Today, after advancing to $2,348, the highest for a most-active contract since Dec. 21, cocoa is above the 200-day moving average of $2,331.

“We need to close above the $2,331 level,” Caruso, a senior broker with Chicago-based RJO, said in a telephone interview. “If we do that, this market could press on toward the $2,450 and $2,550 area before September. If the price fails to close above $2,331, we will probably see a consolidation phase between $2,260 and $2,330 before another push to the upside.”

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April 5th, 2013

Cocoa futures fell for a third day in London on speculation rain is helping boost crop prospects in Ivory Coast, the world’s largest grower. Sugar also declined.

The Daloa region, which accounts for about a third of Ivory Coast production, had three times more rain from March 21-31 than a year earlier, according to the National Meteorological Service. The Standard & Poor’s GSCI gauge of 24 commodities is down 3.3 percent this week, heading for the biggest weekly decline since October.

“There was some concern dry weather would have a negative effect in Ivory Coast so the rain may be easing those concerns,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt, by phone today. “Cocoa is getting caught up with selling of many commodities.”

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