Keith Brown DTN Contributing Cotton Analyst    

The cotton market was locked limit-up at the time when the Federal Reserve released its policy statement, but then sold down on the news of a 0.75 percent hike. Although the three-quarter-percent jump was widely anticipated, the Fed indicated it would continue its hawkish stance throughout 2023.    

Cotton was strong Wednesday as the market had become quite oversold, plus the fact there may be a serious hurricane in the Gulf of Mexico next week. Through Tuesday night, December Cotton had plunged some 1100 points as longs liquidated, while other speculators sold short.    

USDA will issue its weekly export sales data on Thursday. Hopefully, we will see a complete catch-up of the missing data. The report is out at 8:30 a.m. EDT.    

Crude oil fell to a near two-week low Wednesday as the U.S. dollar soared with the Fed's rate decision. Traders were also fretting over the mobilization of the Russian military. In addition, the EIA inventory number indicated slowing domestic gasoline demand. Supplies were about 8.5 million barrels per day (bpd), its lowest since February. The agency did show a 1.1 million barrel increase in crude stocks last week, which was smaller than the 2.2 million barrel build expected. Nonetheless, it was a build.    

For Wednesday, December closed at 96.92 cents, up 3.59 cents; March 23 finished at 94.06 cents, up 3.61 cents, and July 23 settled at 89.09 cents, 3.07 cents lower. Wednesday's estimated volume was 39,104 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

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