Cotton Rallies Most in Week on China Mill-Demand Gain; Orange Juice Rises

Cotton futures rose the most in a week as demand increased at textile mills in China, the world’s biggest consumer. Orange juice gained.

U.S. export sales of upland cotton in the week ended Sept. 23 jumped 54 percent to 780,045 bales from a week earlier, Department of Agriculture data show. China accounted for 42 percent of the total, the most of any country. Prices for the fiber have jumped 60 percent in the past year. A bale weighs 480 pounds, or 218 kilograms.

“China has continued to buy this week,” said Mike Stevens, an independent trader in Mandeville, Louisiana.

Cotton for December delivery rose 0.73 cent, or 0.7 percent, to settle at 98.56 cents a pound at 2:30 p.m. on ICE Futures U.S. in New York, the biggest gain for a most-active contract since Sept. 28.

“In China, as the cotton harvest gets delayed due to wet weather, it is auctioning incrementally more cotton from its reserves to calm domestic prices,” Macquarie Group Ltd. said today in a research note.

Last week, the fiber fell 1.9 percent, the most since July. Merchant and mill buying rebounded on the dip, Stevens said.

“We’re establishing a trading range,” said Stevens, who said prices may reach about $1.01 this week. Futures touched $1.004 earlier today.

World Cotton Output

World output will increase 16 percent to 25.2 million metric tons in the year that started Aug. 1, from 21.8 million last year, the International Cotton Advisory Committee said last week. The USDA will update its estimates for U.S. and world production and usage on Oct. 8.

Crop conditions in the U.S. improved in the week ended Oct. 3, with 56 percent of cotton rated good or excellent, up from 55 percent a week earlier and 47 percent a year earlier, the USDA said yesterday.

Orange-juice futures rose to the highest level in almost two weeks on expectations for a smaller crop in Brazil, the world’s largest grower, because of drought.

Output in the country’s citrus belt may drop to 271.7 million boxes from 305 million last year, Sucocitrico Cutrale Ltda. Corporate Affairs Director Carlos Viacava said last month. Cutrale makes about 30 percent of global orange-juice supplies.

“If Brazil’s crop size is lower, exporting out of the U.S. will be stronger,” said Jimmy Tintle, an analyst at Transworld Futures in Tampa, Florida.

A box weighs 90 pounds, or 41 kilograms.

Orange-juice futures for November delivery advanced 3.85 cents, or 2.5 percent, to settle at $1.585 a pound at 2 p.m. on ICE, after falling for two straight sessions. Earlier, the price touched $1.64, the highest level since Sept. 22.

To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net.

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

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