ICE cotton futures drifted lower on Wednesday, as traders hunkered down for the U.S. Department of Agriculture’s (USDA) planting intention report due this week.
* Cotton contract for May (CTc1) fell 2.3 cents, or 2.5%, to 91.1 cents per lb by 12:40 p.m. ET (1640 GMT). Last month, prices hit a more than one-year high.
* “The market is just getting ready for the planting report… I expect (the) report to show U.S. plantings of cotton above 11 millions of acres and this will likely pressure the market,” said Jack Scoville, vice president at Chicago-based Price Futures Group.
* The USDA will release the planting intentions report at noon EDT (1600 GMT) on Thursday. The weekly export sales report is also due on the same day.
* Analysts estimate 2024 U.S. plantings of cotton at 10.906 millions of acres versus 10.230 millions of acres in 2023, a Reuters poll showed.
* The U.S. dollar index DXY firmed 0.1%, making cotton more expensive for buyers holding other currencies.
* Last week’s USDA weekly export sales report showed net sales of 92,600 running bales (RB) for 2023/24, up 8% from the previous week. It also highlighted that exports of 397,300 RB, a marketing-year high, were up 36% from the previous week.
* “Cotton prices won’t go below 88 cents in the near-term. If China steps up buying, then it will be bullish. Prices could climb above the $1 mark again if Texas weather turns very hot this summer,” Scoville added.
* In other commodities markets, Chicago corn and soybean futures fell for the day while oil prices were broadly level after official numbers were released for U.S. crude stockpile.
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