ICE cotton futures eke out gains ending its two days of losses

ICE cotton ended its two days of losses as it eked out small gains on Tuesday, while stocks continued to rise as trade buying offset index and fund rolls ahead of the March contract expiry.

The benchmark March cotton contract on ICE Futures U.S. finished up 0.39 cent, or 0.5 percent, at 85.40 cents a lb. Two days of selling had pushed prices to 84.76 cents on Monday.

May futures’ premium over March widened to 68 cents per lb from 56 cents on Monday as indices and funds rolled positions forward ahead of the March expiry on March 7, market participants said. March options expire on Friday.

March is going through its liquidation phase. They ran into enough buying interest to push it up after two days of losses, said Sharon Johnson, a cotton specialist with KCG Futures in Atlanta.

Stocks rose by 10,000 480-lb bales to 168,266.

Fiber underperformed the broader commodities sector, with the benchmark Thomson Reuters/Core Commodity CRB index gaining 1 percent.

Traders, growers and mills were bracing for the National Cotton Council annual meeting on Saturday when the market will get its first official insight into forecasts for plantings this spring.

U.S. farmers expect to increase acreage for the first time in three years, A Reuters poll earlier this month revealed.

The Lunar New Year holiday in top consumer China kept activity levels subdued.

Courtesy: Reuters