ICE cotton futures hit a 5-month low on Thursday, March 12, in a broader markets sell-off after the United States imposed restrictions on travel from Europe that sparked demand fears.
Cotton contract for May fell 1.19 cent, or 1.9%, to 60.36 cents per lb. The contract earlier in the session fell as much as 3.6% to 59.35 cent per lb, its lowest since late September.
“The overall concern is what are consumers going to do? If people pull down on consumption, lock their houses and do not shop that’s a lot more important than whether mills are buying or not,” said John Bondurant, a trader in Memphis, Tennessee. Concerns over the coronavirus outbreak overshadowed data from the United States Department of Agriculture (USDA) that showed net sales hit a fresh marketing year high.
Net sales of 484,200 running bales were up 22% from the previous week and 62% from the prior 4-week average. President Donald Trump ordered travel from Europe to the United States to be restricted for 30 days, responding to mounting pressure to take action against a rapidly spreading coronavirus outbreak. US farmers and traders fear that the situation could get worse, with the market heading towards the mid-50s.