Cotton futures rose to a one-week high on signs of global demand and limited supplies as the worst floods in Pakistan’s history have wiped out crops. Orange-juice prices declined.
The Kissan Board of Pakistan, a trade group, said floods ruined 30 percent of the crop. The country is the world’s fourth-largest grower. Damage to transportation infrastructure will make it “very hard” to get cotton to mills that are trying to replenish low inventories, trader John Flanagan said.
“You’ve got just tremendous demand from around the world, especially from Asia,” said Flanagan, the president of Flanagan Trading Corp. in Fuquay-Varina, North Carolina.
Cotton for December delivery rose 0.54 cent, or 0.6 percent, to close at 84.09 cents a pound at 2:38 p.m. on ICE Futures U.S. in New York. Earlier, the price reached 85.26 cents, the highest level for a most-active contract since Aug. 13. Price are up 43 percent in the past year as textile makers boosted purchases.
“The floods ravaging Pakistan are now putting its cotton harvest at risk with losses still mounting,” Mike Stevens, an independent trader in Mandeville, Louisiana, said in an e-mail today.
The U.S., the world’s largest exporter, will ship 15 million bales to foreign buyers in the year that began Aug. 1, according to the U.S. Department of Agriculture. That’s up 25 percent from 12 million a year earlier. A bale weighs 480 pounds (218 kilograms).
In the week ended Aug. 17, hedge-fund managers and other large speculators, increased their net-long positions, or bets prices will rise, by 23 percent to the highest level since January.
China is the world’s biggest cotton grower, followed by India and the U.S., according to USDA estimates.
Orange-juice futures for November delivery fell 0.75 cent, or 0.5 percent, to settle at $1.3615 a pound in New York. Prices have gained 5.5 percent this year.
U.S. orange-juice sales by retailers fell 8.1 percent in the four weeks ended Aug. 7 compared with a year earlier, the Florida Department of Citrus said today in a report, citing Nielsen Co. data.