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Thursday, October 11, 2007
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Commodity News
Oct 9 2007 11:08AM
US cotton lower on selling, weak grains

New York, Oct 09 - Falling Chicago grains markets and speculative selling left ICE cotton futures on their lows Monday, brokers said. December cotton futures lost 79 points to close at 62.43 cents a pound, and the March contracts fell 65 points to 66.21 cents. "It's kind of an ugly day across the board," said Alan Feild, president of Iamhedged.com, a Memphis brokerage firm. The Columbus Day holiday made for low volume throughout the cotton trading session, though long liquidation marked most commodities markets, he said. Cotton traded in sympathy with Chicago grains, analysts agreed, as Chicago Board of Trade December wheat contracts locked limit-down mid-session at $8.60. December corn settled 2 1/2 cents lower at $3.39 3/4 per bushel and November soybeans decreased 15 cents to $9.25 1/2. Open interest is at huge levels, reckoning a sizable impact for commodities, Feild said. "On the close, one of the biggest signs of what to come, more noted specs where on the floor with quite a bit to sell," said Feild. "With the dollar rallying, people know commodity markets could get a hit." Unseasonably warm temperatures in the US cotton-growing region with 'nary a drop of rain' additionally pressured cotton futures, said Jack Scoville, vice president at Price Futures Group in Chicago. Some grain analysts are predicting bearish figures in Friday's US Department of Agriculture cotton production and supply/demand reports. "This is keeping traders wary and bulls hesitant to do much more than protect big profits," said Mike Stevens, an analyst at SFS Futures in Mandeville, La. In other cotton news, upside potential is most favorable for cotton, as well as coffee, and sugar, but downside potential exists for wheat, oil and gold due to overbought conditions and the increased likelihood of profit-taking, according to a fund portfolio overview by Juno Mother Earth Resources. Cotton certificated stocks for the week ended Oct. 5 are 535,189 bales with 41,122 awaiting review. Open interest Friday rose 757 to total 233,790 contracts, with traders buying December 150 contracts and adding 335 March. Monday's futures volume was estimated at 12,663 on ICE and 5,096 on the floor. In the options, 2,437 calls and 3,099 puts traded. [Source: Dow Jones Newswires]

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