ICE cotton futures fell over 1pc on Monday in low-volume trade, snapping four sessions of gains, as absence of progress in the US-China trade war weighed on investor sentiment. The most-active cotton contract on ICE Futures US, the second-month December contract fell 0.79 cent, or 1.31pc, to 59.34 cents per lb at 2 pm, recording its biggest percentage fall in two weeks.
It traded within a range of 59.07 and 60.25 cents a lb. Mr Keith Brown, principal at cotton brokers Keith Brown and Co in Moultrie, Georgia said, “Prices are falling because the sentiment of the market is still bearish. We don’t have a trade deal. Volume is very low, so there is a lot of disinterest, and people are waiting to see what happens to the trade situation in September.”
US President Donald Trump was less optimistic than his aides about striking a trade deal with China, saying that while he believed China was ready to come to an agreement, he is not ready to make a deal yet. Cotton has fallen more than 19pc so far this year as the prolonged US-China trade war hurt demand for the natural fiber. China is the world’s top consumer of cotton, while the United States one of the biggest producers.
Mr Brown added, “We are also waiting on the crop progress report to come out this afternoon. We will see if there is more damage to the Texas crop. The US Department of Agriculture’s (USDA) US crop condition report is expected to come out this week. The contract had touched a 3-1/2-year low on Aug 05 due to fears of increasing trade tensions between the United States and China.”
