Page 21 - TEXtalks. October- November 2023

20

Global cotton market sees fluctuations as

buyers and sellers disagree on prices

Cotton production is affected by pink bollworm and action in the cotton market this week was technical
inadequate monsoon in many parts, said Atul related. Commodity index funds have started to roll
Ganatra, president of the Cotton Association of their positions forward, which was a major
India. According to Nishant Asher, secretary of the contributor to this week’s sell-off. Pressure was also
Indian Cotton Federation (ICF), the main issue this added from weak domestic cotton prices in China,
year will be demand and not supply. The daily slight uncertainty with the Fed’s rate decision this
arrivals to the market at present are 70,000 to one week, and continued geopolitical tensions.
lakh bales. Currently, Indian cotton prices are on a
par with the international prices. If the international Increased demand for U.S. cotton was reported for
prices decline, Indian cotton will become expensive. the second consecutive week. The U.S. exporters
This will hit the domestic textile industry further. sold a substantial 457,100 Upland bales and 25,800
Pima bales, with both growths reaching a marketing
Brazil’s cotton market saw fluctuations as buyers year high of bales sold in a week. Sales were far
and sellers disagreed on prices. Purchasers above what is typically seen during this week of the
pressed for lower rates, resulting in limited trades, marketing year. China took the lead as the biggest
mainly for inventory replenishment. Cotton prices buyer this week, booking 324,000 Upland bales.
experienced fluctuations in the Brazilian spot market Rumor has it that purchases for the Chinese
this October. The market saw a divergence between Reserve made up a good portion of these sales.
the quality of cotton and the prices demanded by Mexico was the next biggest buyer, booking 108,200
buyers and sellers. Purchasers exerted pressure on bales, followed by Peru with 11,200 bales, South
quotations by holding firm on their price expecta- Korea with 8,400 bales, and Vietnam with 7,000
tions, while same sellers sought higher values, bales. The continued lull in prices and the recent
resulting in moments of stability, according to a International Cotton Association (ICA) Trade Event
report from the Center for Advanced Studies on helped drum up more demand for U.S. cotton.
Applied Economics (CEPEA).
Traders will also keep their usual focus on weather,
In the United States, the December futures settled daily classing reports, and the Export Sales Report
below 80.00 cents per pound this week, settling to see if the recent price dips will continue to show
below the long-term average. Much of the price increased demand for U.S. cotton.

October/November 2023