Futures Market News
Chinese demand pushes up cotton futures
Jan 24, 2011 09:52 AM
Increasing demand for cotton from China threatened to endanger the global supply of the soft fiber, pushing up the commodity to the maximum allowed on ICE Futures US, Bloomberg reports.
March-delivery cotton futures rose 0.05 cents, a 3.2 percent increase to $1.6194 per pound just before noon in Tokyo. As the globe's largest consumer, China imported 86 percent more cotton in 2010 than the year prior, a change attributable to economic growth in the rising tiger.
"Cotton was supported by China's import data and speculation that the country will buy more before the Lunar New Year holidays," Han Sung Min, a broker at Korea Exchange Bank Futures in Seoul, told Bloomberg.
Shortly after 12:30 a.m., cotton futures in New York were valued at $1.6194 per pound, a 3.19 percent increase of 0.05 cents.
March-delivery cotton futures have gained five-straight days. The contract last week increased 11 percent.
The U.S. Agriculture Department slashed estimates for global production on January 12. Global production of the commodity will be 115.46 bales, representing a 0.1 percent decrease from the expected output issued on January 12.
Cotton stockpiles for 2010-2011 are projected to be 9.3 million tons, which equals 42.8 million bales, according to the Commonwealth Bank of Australia. That figure represents the most constricted amount since 1995-1996.
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