Cotton prices would further rise : Global

Cotton prices are still expected further rising in the short term although US futures last Wednesday sharply fell before recovering on Thursday and Friday. The high level in China''s cotton imports could stimulate prices for the coming months, experts warned after the US Department of Agriculture again lowered forecasted China''s output in 2003-2004.

After dramatically sliding last Wednesday, US futures rose in the two consecutive days with December finally finishing the week at 74.90 cents per pound, down 3.07% from previous Friday. The fall in December contract is partly due to its imminent liquidation while most active March was only 1.25% down in the past week. Bullish US export data. US futures rebounded after the US Department of Agriculture (USDA) released bullish export data for the week ended November 6th.

Sales reached 448,800 running bales, up 63% from the week earlier, USDA said. More important, China was the largest buyer with 231,000 RBs, followed by Brazil (44,500 RBs), Mexico (32,200 RBs) and Turkey (25,900 RBs). Shipments began booming in the same week, up 43% over the previous week at 185,900 RBs with exports to China reaching 75,400 RBs.
USDA''s data are a clear sign that orders from Chinese spinners are far from weakening in line with the high level of domestic prices in the PRC. Although China''s textile activity is apparently declining and demand for cotton is slowing down, domestic prices did not substantially change in the past weeks, remaining at about 17,000 yuan per ton or 96 cents per pound.