ICE cotton marks biggest weekly decline in nine months

ICE cotton marks biggest weekly decline in nine months

June 22 (Reuters) – ICE cotton futures rose more than 1 percent on Friday, supported by a rebound in commodity prices, but the natural fiber marked its worst week in nine months amid escalating trade tensions between the United States and China. * The most active cotton contract on ICE Futures U.S., the third-month December contract , settled up 1.01 cent, or 1.2 percent, at 85.3 cents per lb. It traded within a range of 84.2 and 85.62 cents a lb. * The third month contract fell about 5 percent for the week, the biggest weekly decline since mid-September. * “Today cotton is being bolstered by the macro scenario. Commodities in general are rallying today after dropping due to trade concerns,” said Gabriel Crivorot, an analyst at Societe Generale in New York. * U.S. protectionism is self-defeating and a “symptom of paranoid delusions” that must not distract China from its path to modernisation, Chinese media said on Friday as Beijing kept up with its war of words with Washington. * U.S. is the world‘s biggest cotton exporter, while China is the top consumer. * “As far as cotton is concerned, we need to wait and see whether the impact is going to be as significant as some traders fear. China will probably still have to import more cotton over the coming years, even from the U.S.,” British merchant Plexus Cotton said in a note. * “Fundamentals remain supportive, apart from the trade dispute. The U.S. crop has been struggling during this planting season and needs to prove itself in the months ahead, while the supply pipeline will be about as tight as we have ever seen it at the end of summer,” it added. * Speculators cut their net long position in cotton by 16,164 contracts to 93,044 in week to June 19, U.S. Commodity Futures Trading Commission data showed on Friday. * Total futures market volume fell by 4,972 to 18,131 lots. Data showed total open interest fell 3,880 to 261,946 contracts in the previous session. * Certificated cotton stocks <CERT-COT-STX> deliverable as of June 21 totaled 86,067 480-lb bales, up from 85,439 in the previous session. (Reporting by Eileen Soreng and Vijaykumar Vedala in Bengaluru Editing by Marguerita Choy)

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