US cotton prices hit a 12-week high, as demand from Chinese mills increased in light of the poor fiber quality of domestic stockpiles, The Wall Street Journal reported. The ICE Futures US exchange, a barometer of prices for what some consider to be the highest quality cotton, showed that March delivery orders for the fiber increased 1.12 cents, or 1.5% to 77.33 cents per pound, the highest level since October 18. China, believed to hold nearly half of the world’s cotton supply in warehouses, began auctioning stockpiles to local mills on Monday. Traders were concerned that the sales would reduce demand for foreign cotton, but less than 70% of fiber on offer sold on Monday and Tuesday. The mills were not satisfied with the quality of cotton offered, analysts said. The development spurred speculative investors to wager that Chinese mills would demand US cotton, pushing up prices.
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