Cotton futures were called to open around unchanged this morning with the fairly neutral USDA report and a general lack of over the weekend business being reported.
Prices actually dipped lower on the opening, but into strong commercial support at the 52.50-52.60 area, which prompted a brisk return to unchanged after the re-opening.
Some notable commercial players were seen actively buying futures all the way to the 53.00 area and with a general lack of commercial selling above the market, prices were allowed to be dictated by fund buy stop orders.
Indeed with the AWP now at 44.64, there is little if any commercial selling out of the US merchants or producers until levels above 55.00 cents. Buy stop after buy stop was elected thus, and soon prices had extended beyond the 53.50 level and as high as 54.00 in early action.
Some foreign commercial hedging was found around this area, as prices chopped around beneath 54 cents for much the rest of the session.
Further fund buying ( one overseas fund bought nearly 1000 going into the close ) ensued prices closed very firm on the session highs across the board in what should spur on some further fund buying tomorrow.
Estimated volume today was decent at 19,000. This morning's USDA supply and demand estimate was fairly ho—hum.
World beginning stocks ( from India and WAF ) were raised 420,000 bales. Supply was increased in China ( 500,000 ) and Brazil ( 250,000 ) whilst it was reduced in Australia ( 400,000 ).
marketing@alchempro.com
