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NEW YORK (June 18 2010): Cotton futures settled lower on Thursday in another round of switch trade while most players looked toward deliveries next week and the release of a government plantings report this month, analysts said. The key December cotton contract declined 0.28 cent to finish at 79.42 cents per lb, dealing from 78.69 to 79.84 cents. Volume traded in the December contract stood at 12,323 lots at 2:36 pm EDT (1736 GMT). Spot July fell 0.97 cent to end at 80.80 cents.
"We're still caught in this see-saw style of trading that has affected many markets," said Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia. He said there is "a little angst" in the trade at the seemingly slow pace positions are being unwound in the spot July contract with deliveries looming on June 24. Open interest in July stood at 20,056 lots as of June 16, down by 3,621 lots from the previous day's level.
The market gave scant reaction to the weekly export sales data from the US Agriculture Department. USDA said total US cotton sales reached 540,600 running bales (RBs, 500-lbs each), well above trade expectations it would range from 200,000 to 300,000 RBs and last week's total sales of 823,100 RBs. USDA said US cotton export shipments reached 265,400 RBs, against shipments last week of 227,600 RBs.
Further out, the market will then be looking toward the US Agriculture Department's annual planted acreage report on June 30 which would provide an idea on the size of the US cotton crop in the 2010/11 marketing year (August/July). Volume traded Thursday reached 17,009 lots, from the prior tally of 19,358 lots, ICE Futures US data showed. Open interest in the No 2 cotton market was at 172,847 lots as of June 16, compared to the prior 172,128 lots, the exchange said.
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