Cotton futures slid Thursday as traders began to doubt that the pace of U.S. cotton exports would meet government projections.
Cotton for July delivery fell 2% to 72.07 cents a pound on the ICE Futures U.S. exchange.
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Rose Commodity Group said Thursday that while the demand for U.S. cotton for export has been decent and overseas demand for the upcoming crop has been excellent, the current level of old crop commitments suggests that the Agriculture Department's export projections of 14.5 millions bales for the 2016/2017 season may be 300,000 to 400,000 bales too high.
Certified stocks of cotton have been piling up, reaching 473,000 bales, which, along with a recent drop in cotton futures, could inspire a buyer to take delivery of those stocks.
"With planting as large as it is, it is unlikely that a crop disaster will occur that would spin the market completely around and turn the fundamentals to be exceedingly bullish, especially with worldwide cotton sowings expected to expand and stocks outside China increase once again," said Judith Ganes, president of J. Ganes Consulting.
She said the best opportunity for a bull move in cotton is if prices sink first in order to stimulate strong buying from mills.
In other markets, raw sugar for July fell 0.7% to 13.53 cents a pound, cocoa for September lost 0.2% to $2,070 a ton, arabica coffee for September was up 0.5% at $1.2835 a pound and frozen concentrated orange juice for July rose 1.4% to $1.423 a pound.
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(END) Dow Jones Newswires
June 15, 2017 12:35 ET (16:35 GMT)