DTN Cotton Open: Bounces After Bearish Daily Reversal

    ©Debra L Ferguson Stock Images

    March still positioned above last month’s finish. Cash online grower sales declined to 12,037 bales and business sales fell to 1,369 bales on The Seam.

    Cotton futures ticked slightly higher on this last day of the month Tuesday, a day after finishing a daily outside-range-reversal down.

    Spot March hovered up 30 points to 74.44 cents, trading within a tight 54-point range from 74.10 to 74.64 cents on a contract volume of 2,460 lots, still positioned above last month’s close of 70.65 cents. May gained 35 points to 75.17 cents on a turnover of 1,527 lots.

    In outside markets, U.S. dollar index futures traded down 0.425 to 99.990, while Dow Jones futures ticked down 36 points and S&P futures 4.75 points. Crude oil gained 56 cents to $53.19, Brent crude added 39 cents to $55.62 and February gold rose by $10.80 to $1,204. March corn was up 0.2%, March soybeans also up 0.2%, March Chicago wheat little changed and March Kansas City wheat off 0.4%.

    Earlier, Asian stock markets were lower, with Japan’s Nikkei 225 finishing down 1.7%. Australia’s S&P/ASX 200 dropped 0.7%. In Europe, Germany’s DAX and France’s CAC 40 both rose 0.2%.

    Markets in China, Hong Kong and Taiwan remained closed for the Lunar New Year holidays. China’s cotton markets will reopen Friday. India’s MCX cotton futures eased.

    In overnight news, the Bank of Japan raised its forecast for this fiscal year, citing signs of recovery in manufacturing, but left its policy unchanged. It left intact its 1-year-old minus 0.1% benchmark interest rate.

    In ICE cotton futures Monday, March reversed from within five ticks of the January high, which was its highest intraday print since early August, and closed below Friday’s low, down 0.95%. The low for the month has been 71.14 on Jan. 3 and the high 72.57 on Jan. 5.

    The March-May spread traded from 48 to 70 points carry and widened 14 points to close at 68 points on a volume of 6,359 lots. May-July traded from 44 to 64 points carry and widened 11 points to settle at 62 points on 1,280 lots. The inverted July-December intercrop straddle traded from 428 to 382 points and narrowed 26 points to finish at 385 points on 705 lots.

    In cash online trading, grower-to-business sales declined to 12,037 bales from 26,513 bales on The Seam. Prices dropped to an average of 69.77 cents from 70.40 cents, reflecting a rise to 16.79 cents from 16.45 cents in premiums over loan repayment rates.

    Business-to-business sales fell to 1,369 bales from 4,185 bales on prices averaging 69.86 cents, down from 71.29 cents, and premiums of 17.69 cents, up from 16.92 cents.

    The Cotlook A Index of world values gained 70 points, widening the premium over the prior-session March futures settlement four points to 9.40 cents.

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