US Cotton prices jumps amid plans for lower US cotton planting
Cotton prices yesterday hit a six-month high - up 8.5 per cent this year - as speculators gave more weight to news of lower planting intentions in the US on the back of dismal demand from the textile sector in the short-term. Mike Stevens, an analyst for cotton brokers SFS Futures in Mandeville, Louisiana, said that…
Egytex News Desk
Source: Financial Times
US farmers - the world's largest exporters of the fibre - have signalled they will sow the smallest acreage since 1983 as cotton prices remain low compared with other competing crops, particularly soyabean. But some traders questioned whether lower planting would be enough to offset sharply falling consumption.
The US department of agriculture forecast 2008-09 cotton demand will drop by 10.5 per cent, the largest annual percentage decline since records began in 1920. "Cotton consumption shows no sign of recovering, given the weak global economic outlook and the resulting low demand for textiles," it said in a recent report.
In afternoon trading in New York, ICE May cotton rose 0.5 per cent to 53.08 per pound, the highest since mid-October. The July contract gained 0.6 per cent to 53.65 cents per pound. Mr Stevens added that some fundamentals were, however, supporting the price, particularly hopes that companies may start to rebuild inventories and concerns about dryness in the West Texas cotton patch, where several million acres do not have irrigation.
Source: Financial Times
From the Egytex news archive, first published on 2 May 2009. Figures and names are as reported at the time.
