By Sonja Elmquist
Feb. 18 (Bloomberg) -- Cotton rose to the highest price since July 2008, resuming this month’s rally, on speculation that supplies will remain tight this year as demand increases.
U.S. export sales of upland cotton more than doubled in the first five weeks of 2010 from the same period last year, U.S. Department of Agriculture data show. Global imports will jump 12 percent to 33.8 million bales in the year through July, the USDA said on Feb. 9. A bale weighs 480 pounds, or 218 kilograms. The U.S. is the world’s biggest shipper of the fiber.
“This year, we’ll have a shortage before the new crop starts to move,” said Mike Stevens, an independent trader in Mandeville, Louisiana. “You’ve got to get from this year to next year, and that’s a gap.”
Cotton futures for May delivery jumped 2.02 cents, or 2.7 percent, to 78.13 cents a pound on ICE Futures U.S. in New York, after earlier touching 78.3 cents, the highest price for a most- active contract since July 1, 2008.
Cotton has rallied 73 percent in the past year as a drop in output in the U.S. reduced supply as demand rebounded. China is the world’s largest buyer of the fiber.
A weekly USDA report on cotton exports will be released tomorrow, the department said.