Wednesday, 20/03/2013
Cotton prices have risen as the market focuses on tightening stocks outside China. Internationally, there's still plenty of cotton available. However, the majority is being held by the Chinese Government and is not available to the broader market.
The rally in international cotton prices is driving local prices higher to about $450 a bale, but cash prices and income earnings are being held back by the high Australian dollar. Cotton market adviser Matthew Leeson says cotton's price increase is positive compared to the fall in grain prices.
"Cotton is defying the trend at the moment and futures are well above average, and although cotton prices are still below average, we're certainly a lot more comfortable and the outlook is a little brighter than it was three or four months ago." (Source: ABC Rural)