By Keith Brown, DTN Contributing Cotton Analyst 

The cotton market traded higher in the early morning session as Hurricane Laura was projected to intensify to a Category 4 storm as it slanted more toward western Louisiana. However, as the day wore on, still a Category 4, Laura began shifting more northwest, hitting into the Texas/Louisiana border. At that point, the storm premium began to deflate, and the market retreated. By the settlement, the market had closed dead-on its opening of Wednesday, which was 65.58 cents.

Wednesday, USDA will issue its latest export sales report and expectations are for strong numbers. Last week, the report showed 128,000 bales sold, with 221,000 bales plus shipped. About one-half of that business was absorbed by China. Despite publicly airing their political differences, China continues to subtly buy cotton from U.S. merchants.

Fed Chair Jerome Powell is scheduled to address the U.S. central bank’s policy framework review Thursday about 10 a.m. ET in the Virtual Policy Symposium. Traders and investors are focused on whether he will hint at shifting the Fed’s inflation target to an average. The meaning of such a shift would be to targeting average inflation over time, rather than setting a fixed 2% goal. Supposedly such a move would result in lower rates, and most likely erode the value of the U.S. dollar.

Wednesday, December cotton closed at 65.58 cents, which was flat. March settled at 66.45 cents, plus 0.03 cent, and Red December ended at 65.33 cents, also unchanged. Wednesday’s estimated volume was 17,230 contracts.