Cotton futures slip nearly 1% to Rs 21,060 per bale on higher stocks

Cotton futures traded weaker at Rs 21,060 per bale on January 15 as participants trimmed their positions as seen from open interest. Cotton prices had dropped 0.5 percent January 14 to settle at Rs 21,260/bale on the MCX.

“Despite positive cues from the international market, domestic cotton futures failed to sustain above Rs 21,300 levels as Cotton Association of India (CAI) revising higher domestic cotton carry forward stock for this season and limited buying from local millers have kept Cotton prices under check,” said Mohit Vyas, Analyst at Kotak Securities.

The United States Department of Agriculture (USDA) has lowered world Cotton stock estimates for 2020-21 season and failing supply in the physical market may support natural fibre from lower levels.

In the futures market, cotton for January delivery touched an intraday high of Rs 21,250 and an intraday low of Rs 21,000 per bale on the MCX. So far in the current series, the commodity has touched a low of Rs 19,340 and a high of Rs 21,450.

Cotton futures for January delivery fell Rs 200, or 0.94 percent, to Rs 21,060 per bale at 15:20 hours IST on a business turnover of 3,599 lots. The same for February contract declined Rs 210, or 0.98 percent, at Rs 21,320 per bale with a business volume of 2,345 lots.

The value of January and February’s contracts traded so far is Rs 29.98 crore and Rs 13.15 crore, respectively.

Lower-than-expected stock revision by USDA in January WASDE report is likely to keep Cotton on a firm note in coming sessions, said Kotak Securities.

At 09:25 (GMT), US Cotton futures decreased 0.23 percent quoting at 80.96 cents/pound on Intercontinental Exchange (ICE).

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