Keith Brown DTN Contributing Cotton Analyst    

The market was moderately higher Tuesday, as cotton was buoyed by its own oversold condition and positive outside forces. The Dow and the energies were higher, while the U.S. dollar declined. Of course, with all the fear and hype of the U.S. banking crisis, Wednesday's interest rate announcement is turning out to be a watershed moment.    

Traders are also anticipating the 2023 planting intentions due at month's end. It's widely expected that cotton acres in the U.S. will be greatly diminished. Numerically, a year-over-year reduction of at least 20% is expected.    

Option expiration for the May contract occurs in 24 days, while the July fades in 87 days. Given the trend of the market and slow foreign demand, there is building pressure for those options to expire lower.    

Crude oil was higher Tuesday, as prices recovered from a 15-month low hit the previous day. The actual supply and demand for the energies is not that much out of balance, but the jitters of the banking crisis caused prices to fold. Traders do worry that the global banking risks potentially could be a bearish factor in economic growth and fuel demand.    

Tuesday, May 2023 finished at 77.85 cents, up 0.63 cent, July settled at 78.45 cents, up 0.75 cent and December 2023 ended at 79.54 cents, 0.73 cent higher; estimated volume was 30,985 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

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