Cotton futures trade weaker at Rs 18,210 per bale in evening trade

Cotton futures traded weak at Rs 18,210 per bale on October 5 as participants trimmed their positions, as seen from the open interest.

Mohit Vyas, analyst at Kotak Securities said, "Recovery in ICE Cotton futures from lower levels, CCI planning to start procurement and improved demand from millers and ginners have lifted cotton by Rs 200 in last holiday-shortened week."

According to Agmarknet data, cotton arrivals across the country during September have more than doubled from pevious month at 68,640 tonnes, but it is still down by 36 percent from September 2019.

Participants expect Indian cotton exports to surge by nearly 30 percent in 2020-21 season following attractive Indian cotton prices.

In the futures market, cotton for October delivery touched an intraday high of Rs 18,210 and an intraday low of Rs 18,060 per bale on the MCX. So far in the current series, the commodity has touched a low of Rs 16,060 and a high of Rs 18,270.

Cotton futures for October delivery slipped Rs 30, or 0.16 percent, to Rs 18,210 per bale at 7:02 pm on a business turnover of 709 lots. The same for November contract fell Rs 20, or 0.11 percent at Rs 18,240 per bale with a business volume of 417 lots.

The value of October and November’s contracts traded so far is Rs 5.81 crore and Rs 3.73 crore respectively.

Kotak Securities expects cotton to consolidate near the current range in the coming sessions. The US Department of Agriculture will release October month WASDE report by the weekend, which will be crucial for deciding the course of cotton futures prices in the international market.