Technically Cotton market is under fresh selling as market has witnessed gain in open interest by 1.15% to settled at 1752 while prices remain unchanged 0 rupees.
Now MCX Cotton is getting support at 25550 and below same could see a test of 25490 levels, and resistance is now likely to be seen at 25650, a move above could see prices testing 25690.
Cotton yesterday settled flat at 25620 as Cotton production in Gujarat is likely to grown by 10-12% in the new cotton season beginning October.
Despite lower acreage, the output is expected to increase in 2021-22 due to the improved yield following recent spell of rain and favourable climatic condition.
The 2021/22 marketing year for cotton began on August 1 and the yield increase reflected in the September WASDE indicates significant weather improvements.
On the supply side, USDA revised cotton area planted down from 11.72 million acres in August to 11.19 million acres, which is down almost 7.5% compared to the 12.09 million acres planted in 2020.
On the demand side for cotton, domestic use remained unchanged from August at 2.5 million 480-pound bales, an increase of 6% compared to 2020.
However, estimates for cotton exports increased 500,000 480-pound bales from August to September, now registering 15.5 million 480-pound bales, which is still pacing about 5% behind exports in 2020 when 16.37 million 480-pound bales were exported.
The Southern India Mills’ Association (Sima) and Confederation of Indian Textile Industry (Citi) have thanked chief minister M K Stalin for removing the 1% cess on cotton and cotton waste. In spot market, Cotton dropped by 70 Rupees to end at 26430 Rupees.
--Cotton trading range for the day is 25490-25690.
--Cotton prices settled flat as cotton production likely to rise by 12% in new season in Gujarat
--USDA hiked its estimate for U.S. production and ending stocks for the 2021/22 marketing year
--Industry bodies hail removal of 1% cess on cotton, cotton waste
--In spot market, Cotton dropped by 70 Rupees to end at 26430 Rupees.
Courtesy: Kedia Commodities