Cotton Futures Drop on Demand Concerns; Orange Juice Advances
Cotton futures fell for a second straight session on concern that demand will slow from China, the world’s biggest user and importer. Sugar also slid, while orange juice, coffee and cocoa rose.
In April, China’s fixed-asset investment unexpectedly slowed from a month earlier, while the country’s industrial output grew 9.3 percent, the National Bureau of Statistics said today, trailing analysts’ estimates in a Bloomberg survey. In the season starting Aug. 1, Chinese imports of the fiber may tumble 34 percent from a year earlier as the nation’s stockpiles swell, the U.S. Department of Agriculture said last week.
“China reported a poor industrial production number overnight, which I take as bearish to cotton,” Keith Brown, the president of Keith Brown & Co. in Moultrie, Georgia, said in an e-mail.
Cotton for July delivery dropped 0.5 percent to settle at 86.04 cents a pound at 2:30 p.m. on ICE Futures U.S. in New York. The price fell 1.6 percent in the previous session.
Also in New York, raw-sugar futures for July delivery slipped 1 percent to 17.25 cents a pound.
Orange-juice futures for July delivery jumped 2.6 percent to $1.4815 a pound, the fourth consecutive gain and the longest rally in two months. Earlier, the price reached $1.496, the highest for a most-active contract since April 17.
On May 10, the USDA affirmed the outlook for Florida’s orange crop, the world’s second largest, with output expected to drop to the lowest in four years after drought and a plant disease called citrus greening curbed the harvest’s potential. Brazil is the biggest citrus grower.
Arabica-coffee futures for July delivery advanced 0.9 percent to $1.4575 a pound, while cocoa futures for July delivery jumped 1.1 percent to $2,326 a metric ton, snapping a five-session slump.
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