Cotton Futures and Options Trading

China has led the world in cotton production for many years. Uzbekistan is the world's second largest leading exporter. While China exports extremely little compared to other exporters, its demand role is huge. China's stocks also underline the country's significance. These again, according to most commodity brokers are approaching half of world stocks.

The United States is a large consumer of the commodity cotton. Use has trended higher due to consumers' favor for cotton clothing.

About two thirds of cotton's harvested crop is composed of the seed, which is crushed to separate its three products–oil, meal and hulls. Cotton-seed oil is a common component of many food items, used primarily as a cooking oil, shortening and salad dressing. The oil is used extensively in the preparation of such snack foods as crackers, cookies and chips.

visit Orange Juice Futures, Cocoa Futures, Coffee Futures, Corn Futures, Wheat Futures, Sugar Futures, Soybean Futures and Ethanol Futures.

Cotton No. 2 Futures Commodity Contract Specifications

Cotton Futures

Trading Specs - 50,000 lbs. net weight (approximately 100 bales).

Trading Hours - 1:05 pm to 3:00pm NY time.

Price Quotation - Cents and hundreths of cent per pound

Trading Months - Current month plus one or more of the next twenty-three succeeding months. Active trading months: March, May, July, October, December.

Ticker Symbol - CT

Minimum Fluctuation - 1/100 of a cent (one "point") per pound below 95 cents per pound. 5/100 of a cent (or five "points") per pound at prices of 95 cents per pound on higher. Spreads may always trade and be quoted in one point increments, regardless of price levels.

Last Trading Day - Seventeen business days from end of spot month.

First Notice Day - Five business days from end of preceding month.

Daily Price Limit - 3 cents above or below previous day's settlement price. However, if any contract months settles at or above $1.10 per pound, all contract months will trade with 4 cent price limits. Should no month settle at or above $1.10 per pound, price limits stay (or revert) to 3 cents per pound. Spot month - no limit on or after first notice day.

Tick Value - $5.00

Delivery Points - Galveston, TX; Houston, TX; New Orleans, LA; Memphis, TN; Greenville/Spartanburg, S.C.

Cotton Options

Trading Unit - One New York Cotton Exchange Cotton No. 2 Futures Contract

Trading Hours - 1:05 pm to 3:00pm NY time.

Price Quotation - Prices quoted in cents and hundreths of a cent

Trading Months - March, May, July, October and December. The nearest ten delivery months will be available for trading.

Ticker Symbol - CT

Minimum Fluctuation - commodity Prices quoted in cents and hundreths of a cent

Last Trading Day - The last Friday which precedes first notice day for the underlying future by at least five business days

Expiration Date/Time - Until 5:00 p.m (New York time) on any trading day including last trading day. Automatic exercise at one tick or more in-the-money at expiration on last trading day.

Daily Price Limits - None

Strike Price Increments - 1 cent increments

Minimum Price Fluctuation - 1/100 of a cent

Point Value - $5.00

Converting metric tons into bushels and bales:

One million metric tons of cotton equals 4.59 million bales.

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