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ICE Cotton Futures Advances on Bets Chinese Demand to Remain Robust |
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2010-12-9
Cotton futures rose for the first time in three days on speculation that government efforts in China, the world's biggest fiber consumer, won't erode demand.
China's central bank may raise borrowing costs again in a shift to a more "prudent" monetary policy, according to the ruling Communist Party's Politburo. Cotton has surged 75 percent this year on signs that demand will outpace dwindling worldwide supplies.
China's efforts won't have a "lasting effect," said Mike Stevens, an independent trader in Mandeville, Louisiana. "You could cool it some, and you’re still not really going to hurt demand."
Cotton for March delivery climbed 1.58 cents, or 1.2 percent, to settle at $1.3195 a pound at 2:46 p.m. on ICE Futures U.S. in New York. The price declined 1.5 percent in the previous two days.
On Nov. 10, the fiber reached $1.5195, the highest since the commodity began trading 140 years ago.
China may import 15 million bales in the year ending July 31 to help meet domestic demand, the USDA said on Nov. 9. That would be up from 10.9 million a year earlier, the agency said. The department will update its projections on Dec. 10. A bale weighs about 480 pounds, or 218 kilograms.
ICE cotton futures prices (Dec 8, 2010)
ICE Mar11 Cotton Trend:
Source: Bloomberg
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