BS; Cotton Extends Gains on Lower Supplies; Orange Juice Advances
By Debarati Roy and Jae Hur
Jan. 19 (Bloomberg) -- Cotton jumped the most in six weeks on concern supplies may be limited from Uzbekistan, the world’s third-biggest exporter, and as the dollar fell, increasing the appeal of some commodities. Orange juice rose.
Cotlook Ltd., a research firm based in Birkenhead, England, lowered its estimate for Uzbekistan’s crop by about 5 percent, according to Sharon Johnson, a senior analyst at Penson Futures in Atlanta. The dollar dropped as much as 1.1 percent against the euro.
“Concerns about falling global supplies and a weaker dollar are pushing cotton up,” Johnson said. “Also, there are some technical considerations.”
Cotton for March delivery rose by the exchange limit of 5 cents, or 3.4 percent, to $1.5044 a pound at 8:55 a.m. on ICE Futures U.S. in New York. A close at that level would be the biggest gain since Dec. 3.
The most-active contract, which has more than doubled in the past year, also climbed by the exchange limit yesterday, then at 4 cents.
“There’s market expectation that China may make big deals to purchase cotton and soybeans from the U.S. during Chinese leader Hu Jintao’s visit,” said Han Sung Min, a broker at Korea Exchange Bank Futures Co. in Seoul. The market was also supported by tight global supplies, he said.
Hu arrived in Washington on Jan. 18 for his first state visit to the U.S.
The China Cotton Association this week said the country’s imports in December more than doubled to 462,000 metric tons from a year earlier, citing customs data.
For the year started Aug. 1, the U.S. is forecast to be the largest exporter, followed by India, Department of Agriculture data show. A bale weighs 480 pounds, or 218 kilograms.
Orange-juice futures for March delivery gained 0.35 cent, or 0.2 percent, to $1.7575 a pound on ICE, rising for a third straight session.
--Editors: Daniel Enoch, Millie Munshi.
To contact the reporter on this story: Debarati Roy in New York at droy5@bloomberg.net; Jae Hur in Tokyo at jhur1@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.
