The U.S. government was preparing to reduce the estimate of the size of the U.S. harvest, which helped the price of the rapidly rising soft commodity.
"Expectations of lower U.S. output coupled with fear of dry weather across the Texas region is pushing prices higher," Mike Stevens, an independent trader in Louisiana, told the news service. "Also, there is some short covering by some mills."
Shortly after 2 p.m. on Thursday, cotton futures were up 0.99 percent, a 0.0205 cent increase to $2.1011 per pound. Earlier in the day, cotton futures gained the maximum allowed seven cents.
Cotton futures have more than doubled during the past 12 months amidst a sharply increased demand for the commodity from China and decreased output from the U.S., which is the globe's largest shipper of the fiber.
The U.S. state that generates the most cotton is Texas.
Cotton futures touched a record price of $2.197 per pound on March 7.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.