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ICE Cotton Futures Extends Rally on Global Supply Concern |
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2010-12-15
Cotton futures rose to a one-month high on concern that global supplies will lag behind demand and India's output may be lower than estimated.
Prices have surged 91 percent this year, heading for the biggest annual gain since 1973, on signs that growers would struggle to meet mounting demand from China, the world's biggest user. The Confederation of Indian Textiles Industry said last week that the nation's output may miss an estimate by the government's Cotton Advisory Board's estimate.
"Concern about India's crop, coupled with Chinese demand, is helping prices stay strong," said Chris Kramedjian, a risk- management consultant at FCStone Fibers & Textiles in Nashville, Tennessee. "Also, there is overall bullishness in the market."
Cotton for March delivery jumped 3.52 cents, or 2.5 percent, to settle at $1.4449 a pound on ICE Futures U.S. in New York. Earlier, the most-active contract climbed to $1.4597, the highest since Nov. 10. Prices have gained for five straight sessions.
Output in India, the second-biggest grower and exporter, may touch 30 million bales of 170 kilograms each (375 pounds), compared with 32.5 million bales estimated by the advisory board, the industry group said.
ICE cotton futures prices (Dec 14, 2010)
ICE Mar11 Cotton Trend:
Source: Bloomberg
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