ICE cotton rises on short covering, weaker US dollar, rising crude oil
ICE cotton futures rose on Monday, the first trading day of the week, supported by short covering as speculators shed their bearish tone. A stronger crude oil market and a weaker US dollar also lent support. However, the tight range in US cotton prices suggested continued consolidation in the market.
The ICE July 2025 cotton contract settled at 66.13 cents per pound (0.453 kg), up 1.07 cents from the previous day, marking its first triple-digit gain since May 2. The December 2025 contract closed at 68.69 cents, up 107 points, also recording its largest single-day gain since May 2. Other contracts posted gains ranging from 50 to 89 points.
ICE cotton futures rose on Monday, driven by short covering, a weaker US dollar, and stronger crude oil prices. The July 2025 contract saw its first triple-digit gain since May 2, indicating market consolidation. International demand improved as the weaker dollar made cotton cheaper. Trade optimism and OPEC+ decisions also influenced sentiment.
The weaker US dollar against other major currencies made US cotton more affordable for international buyers, encouraging overseas purchases. Crude oil surged nearly 4 per cent after OPEC+ maintained its July output increase at the same level as the previous two months. Higher crude oil prices make polyester—a man-made fibre alternative to cotton—more expensive to produce.
Despite Monday's breakout, cotton prices continued to trade within a tight range for the 13th consecutive session, signalling sustained consolidation.
Total trading volume reached 71,718 contracts, the highest since April 23. In comparison, Friday's cleared contracts totalled 39,650, while the previous week's average daily volume was 40,636 contracts.
The rally was largely driven by short covering, as speculators exited bearish positions following a strong overnight session and key resistance breakouts.
Market analysts noted that Friday's reversal was linked to end-of-month repositioning, which carried over into Monday's session with renewed short-covering momentum. Evidence also pointed to fresh selling at higher levels—likely from producers or merchants locking in sales or fixing July contracts to take advantage of improved prices.
In other commodity markets, Chicago wheat and corn posted gains, while soybeans continued to decline, adding mixed sentiment across the broader agricultural futures space.
Trade optimism also supported sentiment, with US President Donald Trump and Chinese President Xi Jinping expected to speak soon to address ongoing trade tensions, particularly concerning critical minerals. US Treasury Secretary Scott Bessent confirmed that the upcoming talks would focus on resolving disputes and stabilising the bilateral trade relationship.
Meanwhile, Trump announced a tariff hike to 50 per cent on steel and aluminium imports, causing domestic prices for these metals to spike and triggering a sell-off in shares of foreign steelmakers.
Presently, ICE cotton for July 2025 is being traded at 65.87 cents per pound (down 0.26 cent), cash cotton at 64.38 cents (up 1.07 cent), the October 2025 contract at 68.10 cents (up 0.01 cent), the December 2025 contract at 68.39 cents (down 0.30 cent), the March 2026 contract at 69.83 cents per pound (down 0.28 cent), and the May 2026 contract at 70.86 cents (down 0.25 cent). A few contracts remained unchanged, with no trading recorded today.
Fibre2Fashion News Desk (KUL)
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
an hour ago
- Time of India
China's chokehold on rare earths set to suffocate auto industry
Alarm over China's stranglehold on critical minerals grew on Tuesday as global automakers joined their US counterparts to complain that restrictions by China on exports of rare earth alloys, mixtures and magnets could cause production delays and outages without a quick solution. German automakers became the latest to warn that China's export restrictions threaten to shut down production and rattle their local economies, following a similar complaint from an Indian EV maker last week. China's decision in April to suspend exports of a wide range of rare earths and related magnets has upended the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world. The move underscores China's dominance of the critical mineral industry and is seen as leverage by China in its ongoing trade war with US President Donald Trump . Trump has sought to redefine the trading relationship with the US' top economic rival China by imposing steep tariffs on billions of dollars of imported goods in hopes of narrowing a wide trade deficit and bringing back lost manufacturing. Trump and Chinese President Xi Jinping are expected to talk this week, White House spokeswoman Karoline Leavitt told reporters on Tuesday, and the export curbs are expected to be high on the agenda. "I can assure you that the administration is actively monitoring China's compliance with the Geneva trade agreement," she said. MAGNETS HELD UP AT CHINA PORTS Shipments of the magnets, essential for assembling everything from cars and drones to robots and missiles, have been halted at many Chinese ports while license applications make their way through the Chinese regulatory system. The restrictions have triggered anxiety in corporate boardrooms and nations' capitals- from Tokyo to Washington-as officials scrambled to identify limited alternative options amid fears that production of new automobiles and other items could grind to a halt by summer's end. "If the situation is not changed quickly, production delays and even production outages can no longer be ruled out," Hildegard Mueller, head of Germany's auto lobby, said on Tuesday.
&w=3840&q=100)
Business Standard
an hour ago
- Business Standard
Gold price outlook: Analyst suggests buying on dips; key levels to watch
Gold: Consolidating its gains Performance: Following a sharp rally of 2.33 per cent on Monday, Spot gold prices corrected lower on Tuesday as the US dollar recovered. Gold surged sharply higher on June 2, helped by a weaker dollar and renewed safe-haven demand triggered by escalating US-China tensions and Ukraine's massive drone attack on Russia. On June 3, gold, at the time of writing this report, was changing hands at $3,349, down around 1 per cent on the day, while MCX August gold at ₹97,649 was down roughly 0.31 per cent. The yellow metal was lower as the US dollar index strengthened and risk appetite, despite mostly negative news flow, remained healthy. US-China tensions escalate: On June 2, China accused the US of violating the US-China trade truce as the US imposed further chip technology curbs and halted the export of critical US jet engine parts and technology to China. It also plans to broaden restrictions on China's tech sector with new regulations to capture subsidiaries of companies under US curbs. The US also intends to revoke visas for Chinese students with connections to China's Communist Party and security issues. According to the White House, US President Trump and Chinese President Xi are likely to speak this week. Data roundup: US data released on June 3, were mostly mixed, markets gave more weightage to the JOLTs job openings though. Factory order (April) came in -3.7 per cent against the forecast of -3.2 per cent as the prior data was revised lower from 4.3 per cent to 3.4 per cent. Durable goods order (April final) at -6.3 per cent were in line with the forecast. JOLTs job openings (April) surprisingly beat the forecast as openings rose from 72,00,000 to 73,91,000 as against the forecast of 71,00,000. However, the internals of the JOLTs report was not so encouraging as layoffs increased from 1 per cent to 1.1 per cent and the quits rate dropped from 2.1 per cent to 2 per cent indicating reduced prospects of finding a new job. In addition, vacancies in industries like manufacturing and food services declined. The Euro-zone's inflation cooled more than expected as consumer prices rose 1.9 per cent y-o-y in May, trailing the forecast of 2 per cent; the reading was cooler than the prior data of 2.2 per cent. The data bolsters the case for the ECB cutting its key rates by 25 bps in its monetary policy meeting to be held on June 5. Elsewhere, China's Caixin manufacturing PMI (May) fell to 48.3, the lowest since September 2022, from 50.40 in April as trade frictions weighed on the nation's manufacturing sector. CATCH STOCK MARKET LIVE UPDATES TODAY US dollar index and yields: The US dollar index, at the time of writing, was 99.24, up around 0.60 per cent on the day, as the Index recovered from a six-week low ahead of the US ISM services and nonfarm payroll reports. US 10-year yields at 4.46 per cent were up by nearly 0.50 per cent OECD's warning: The OECD slashed its global economic forecasts on trade war leading to uncertainty on business confidence and investment. The organisation sees global economic growth at 2.9 per cent in 2025 from its earlier forecast of 3.1 per cent made in March as the US growth is expected to be 1.6 per cent as compared to its earlier estimate of 2.2 per cent. The OECD forecasts a global growth of 2.9 per cent in 2026, down from the previous forecast of 3 per cent. The organisation warned that fiscal risks are intensifying around the world with tremendous pressure for spending on defence, climate, and aging population. ETF: Total known global gold ETF holdings rose to 88.336MOz on June 2, which is the highest level since May 15. Gold ETFs recorded their first weekly inflow last week after five consecutive weekly outflows. Holdings are up nearly 6.6 per cent year-to-date (Y-T-D). Central Banks' gold buying: Global central banks bought a net 12 tons in April, 12 per cent lower than the previous month. Slower pace of buying could be due to high gold prices in April. Upcoming data: Today's US data on the card include crucial ADP employment change (May) and ISM services (May). Fed will release its beige book, too. Outlook: Spot gold is likely to range trade ahead of the US ISM services and nonfarm payroll reports. US-China tensions and worries over fiscal issues are likely to support the metal. It is advisable to 'buy the dips' for a possible test of $3,435 (₹1,00,000) resistance unless there is a clear improvement in US-China talks or the US nonfarm payroll report is stronger than expected. Support is at $3,325 (₹96,900)/$3,292 (₹95,900). Resistance is at $3,372 (₹98,300)/$3400 (₹99,100)/$3,415 (₹99,500).
&w=3840&q=100)
Business Standard
an hour ago
- Business Standard
Silver price outlook: 'Buy on dips' suggests analyst; check key levels here
Silver- Consolidation ahead of key US data On June 2, spot silver staged its sharpest intra-day rally since 2021 as it surged 5.39 per cent to close at $34.76, the highest daily closing level since October 22. The white metal consolidated its gains on June 3 as the US dollar index strengthened. At the time of writing, spot silver was trading at $34.54, down around 0.63 per cent on the day. The MCX July contract was trading at ₹102,260, up around 0.2 per cent. US-China tensions escalate: On June 2, China accused the US of violating the US-China trade truce as the US imposed further chip technology curbs and halted the export of critical US jet engine parts and technology to China. It also plans to broaden restrictions on China's tech sector with new regulations to capture subsidiaries of companies under US curbs. The US also intends to revoke visas for Chinese students with connections to China's Communist Party and security issues. According to the White House, US President Trump and Chinese President Xi are likely to speak this week. Data roundup: US data released on June 3, were mostly mixed, markets gave more weightage to the JOLTs job openings though. Factory order (April) came in at -3.7 per cent against the forecast of -3.2 per cent as the prior data was revised lower from 4.3 per cent to 3.4 per cent. Durable goods order (April final) at -6.3 per cent were in line with the forecast. JOLTs job openings (April) surprisingly beat the forecast as openings rose from 72,00,000 to 73,91,000 as against the forecast of 71,00,000. However, the internals of the JOLTs report was not so encouraging as layoffs increased from 1 per cent to 1.1 per cent and the quits rate dropped from 2.1 per cent to 2 per cent indicating reduced prospects of finding a new job. In addition, vacancies in industries like manufacturing and food services declined. The Euro-zone's inflation cooled more than expected as consumer prices rose 1.9 per cent year-on-year (Y-o-Y) in May, trailing the forecast of 2 per cent; the reading was cooler than the prior data of 2.2 per cent. The data bolsters the case for the ECB cutting its key rates by 25 bps in its monetary policy meeting to be held on June 5. Elsewhere, China's Caixin manufacturing PMI (May) fell to 48.3, the lowest since September 2022, from 50.40 in April as trade frictions weighed on the nation's manufacturing sector. ALSO READ | US dollar index and yields: The US dollar index, at the time of writing, was 99.24, up around 0.60 per cent on the day, as the Index recovered from a six-week low ahead of the US ISM services and nonfarm payroll reports. US 10-year yields at 4.46 per cent were up by nearly 0.50 per cent OECD's warning: The OECD slashed its global economic forecasts on trade war leading to uncertainty on business confidence and investment. The organisation sees global economic growth at 2.9 per cent in 2025 from its earlier forecast of 3.1 per cent made in March as the US growth is expected to be 1.6 per cent as compared to its earlier estimate of 2.2 per cent. The OECD forecasts a global growth of 2.9 per cent in 2026, down from the previous forecast of 3 per cent. The organisation warned that fiscal risks are intensifying around the world with tremendous pressure for spending on defence, climate and aging population. ETF: Total known global ETF silver holdings, as of May 2, stood at 741.23MOz—highest since 20 November 2024. Silver ETF holdings are up by 4.95 per cent this year as holdings recorded net inflows for four straight weeks. Robert Kiyosaki on Silver: According to the Rich Dad Poor Dad author, silver has the potential to triple in value, calling the asset the biggest bargain of 2025. Outlook: As risk appetite is healthy and silver ETF holdings are rising, silver is likely to do well unless the US dollar rises sharply, or extreme risk aversion takes center stage. In this scenario, it is advisable to 'buy the dips' as the metal is expected to test the key resistance at $35 (₹102,500). A decisive breach of these levels may take the metal quickly to $37 (₹1,08,000). In the near term, the $33.50-$33.70 (₹98,200-₹98,800) zone will act as a key support zone.
