A weakening dollar and restriction of supplies from the globe's third-largest exporter of cotton pushed up cotton's value on Wednesday, Bloomberg reports.
An English research firm reduced estimates for the cotton harvest in Uzbekistan by as much as 5 percent, according to Atlanta, Georgia-based Penson Futures.
"Concerns about falling global supplies and a weaker dollar are pushing cotton up," Penson Futures analyst Sharon Johnson told Bloomberg. "Also, there are some technical considerations."
Just before 11:30 a.m., cotton futures increased the maximum allowed 5 cents, a 3.44 percent increase to $150.44 per bushel.
In addition, the soft commodity's value has been affected by Chinese action and diplomacy. Earlier this week the China Cotton Association said the nation's imports of cotton in December at least doubled to 462,000 metric tons as compared to the same period of 2010.
Chinese leader Hu Jintao is presently on his first state visit to the White House, where one topic of conversation with President Obama is expected to be trade and commerce.
"There's market expectation that China may make big deals to purchase cotton and soybeans from the U.S. during Chinese leader Hu Jintao's visit," Han Sung Min, a broker at Korea Exchange Bank Futures in Seoul, told Bloomberg.
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