12-02-2021 02:47 PM | Source: Kedia Advisory
Cotton yesterday settled up by 0.26% at 30900 as China's cotton reserves - Kedia Advisory
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COTTON

Cotton yesterday settled up by 0.26% at 30900 as China's cotton reserves management company said it will suspend its sales from Dec. 1 based on the current market situation. Cotton prices have dropped recently after Beijing launched a new round of daily auctions to boost supply of the fibre to the market. The Cotton Outlook has scaled up its estimate for global production in 2021-22 (Aug-Jul) by 97,000 tn to 26.0 mln tn, the agency said in its November report. The estimate has been revised upward as production in the African Franc zone and Turkey is expected to be higher. The agency has maintained its output estimate in the US at 3.92 mln tn. Global cotton ending stocks are estimated at 110,000 tn for the ongoing 2021-22 season. Arrivals of cotton in spot markets were at 184,300 bales (1 bale = 170 kg), higher than 171,500 bales on Monday. Of the total quantity, around 10,000 bales arrived in Haryana, 2,800 in Punjab, and 17,000 bales in Rajasthan. Arrivals were pegged at 42,000 bales in Gujarat, around 15,000 bales in Madhya Pradesh, and 44,000 bales in Maharashtra. Nearly 10,000 bales arrived in Karnataka, 3,500 in Odisha, and 40,000 bales in Telangana and Andhra Pradesh combined. In spot market, Cotton dropped by -60 Rupees to end at 31270 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 1.78% to settled at 4850 while prices up 80 rupees, now Cotton is getting support at 30570 and below same could see a test of 30250 levels, and resistance is now likely to be seen at 31290, a move above could see prices testing 31690.

 

Technical Chart

 

Trading Range

Cotton trading range for the day is 30250-31690

Cotton prices rose as China to suspend sales from cotton reserves from Dec 1

Cotton Outlook has scaled up its estimate for global production in 2021-22 by 97,000 tn to 26.0 mln tn

Arrivals of cotton in spot markets were at 184,300 bales, higher than 171,500 bales on Monday

 

COCUDAKL

Cocudakl yesterday settled down by -0.15% at 2743 on profit booking after seen supported amid tight supplies owing to higher input costs with rising global demand. Cotton consumption is consistently on the rise due to increasing demand and mitigating impact of COVID-19 in India, Pakistan, Mexico and Bangladesh. Meanwhile the USDA in its latest monthly report estimated global production to go up due to better crop yields in Brazil, Australia and Pakistan. Elsewhere, it is reported that the US is looking to expand cotton exports to Bangladesh, the world’s second largest importer of cotton whereas in Pakistan, cotton arrivals to ginneries reached over 6.8 million bales, up 70% from a year earlier. The Cotton Association of India (CAI) estimated cotton output at 360.13 lakh bales for the crop year (October-September) 2021-22, due to expectation of better yield. The total cotton production in the last season is estimated at 353 lakh bales, which is 7.13 lakh bales less than the current season, the CAI said in a statement. “The cotton yield is estimated to be excellent and the farmers are expected to go for the third and fourth pickings due to good availability of water following a good monsoon,” CAI president Atul Ganatra told PTI. In Akola spot market, Cocudakl gained by 33 Rupees to end at 2783 Rupees per 100 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -0.48% to settled at while prices down -4 rupees, now Cocudakl is getting support at 2717 and below same could see a test of 2690 levels, and resistance is now likely to be seen at 2785, a move above could see prices testing 2826.

 

Technical Chart

 

Trading Range

Cocudakl trading range for the day is 2690-2826.

Cocudakl dropped on profit booking on concerns of new variant of coronavirus, Omicron.

However downside seen limited amid tight supplies owing to higher input costs with rising global demand.

Cotton consumption is consistently on the rise due to increasing demand and mitigating impact of COVID-19 in India

 

 

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