Investing.com - Cotton futures were up for the first time in three days on Tuesday, as traders snapped up contracts after futures moved into oversold territory, but further downside was seen ahead of the release of a U.S. government crop report later in the week.
On the ICE Futures U.S. Exchange, cotton futures for July delivery traded at USD0.8711 a pound during European afternoon trade, gaining 0.5%.
It earlier rose by as much as 0.55% to trade at a session high of USD0.8714 a pound. Prices touched USD0.8614 a pound on Monday, the lowest since December 19, 2011.
Cotton prices plunged to the lowest level since mid-December on Monday, as farm commodities came under pressure from broader market risk aversion and a stronger U.S. dollar, amid concerns over political uncertainty in Greece.
Cotton, as an industrial commodity, is more affected by macroeconomic jitters than many other crops.
Indications of slowing demand for U.S. supplies and market talk of a flurry of speculative selling further weighed on the commodity.
But prices recovered on Tuesday, as traders closed out bets on lower prices after futures moved into oversold territory, a move known as covering a short position.
Cotton traders were looking towards the USDA’s Supply and Demand Estimates Report for May, scheduled for release on Thursday, May 10.
The report will show the first estimate of market conditions in the coming 2012-13 marketing season, which begins in August 2012 and ends in July 2013.
Meanwhile, market patricians shrugged off a report from the USDA, showing an above-average pace of cotton plantings as of last week.
In its weekly crop progress report published after markets closed Monday, the USDA said that approximately 36% of U.S. cotton crops were planted as of May 6, up from 26% a week earlier and above the five-year average of 28% for this time of year.
In Texas, the largest cotton-growing state in the U.S., 27% of the cotton crop was planted, up 25% the previous week, which is also the five-year average.
The U.S. is the world’s biggest exporter of cotton and the third largest producer of the fiber, trailing only China and India.
Elsewhere, on the ICE Futures Exchange, coffee futures for July delivery rose 0.5% to trade at USD1.7570 a pound, while sugar futures for July delivery tumbled 1.2% to trade at USD0.2084 a pound.
On the ICE Futures U.S. Exchange, cotton futures for July delivery traded at USD0.8711 a pound during European afternoon trade, gaining 0.5%.
It earlier rose by as much as 0.55% to trade at a session high of USD0.8714 a pound. Prices touched USD0.8614 a pound on Monday, the lowest since December 19, 2011.
Cotton prices plunged to the lowest level since mid-December on Monday, as farm commodities came under pressure from broader market risk aversion and a stronger U.S. dollar, amid concerns over political uncertainty in Greece.
Cotton, as an industrial commodity, is more affected by macroeconomic jitters than many other crops.
Indications of slowing demand for U.S. supplies and market talk of a flurry of speculative selling further weighed on the commodity.
But prices recovered on Tuesday, as traders closed out bets on lower prices after futures moved into oversold territory, a move known as covering a short position.
Cotton traders were looking towards the USDA’s Supply and Demand Estimates Report for May, scheduled for release on Thursday, May 10.
The report will show the first estimate of market conditions in the coming 2012-13 marketing season, which begins in August 2012 and ends in July 2013.
Meanwhile, market patricians shrugged off a report from the USDA, showing an above-average pace of cotton plantings as of last week.
In its weekly crop progress report published after markets closed Monday, the USDA said that approximately 36% of U.S. cotton crops were planted as of May 6, up from 26% a week earlier and above the five-year average of 28% for this time of year.
In Texas, the largest cotton-growing state in the U.S., 27% of the cotton crop was planted, up 25% the previous week, which is also the five-year average.
The U.S. is the world’s biggest exporter of cotton and the third largest producer of the fiber, trailing only China and India.
Elsewhere, on the ICE Futures Exchange, coffee futures for July delivery rose 0.5% to trade at USD1.7570 a pound, while sugar futures for July delivery tumbled 1.2% to trade at USD0.2084 a pound.