Oct 13 (Reuters) -ICE cotton futures rose more than 1% on Friday as poor crop conditions in key U.S. growing regions sparked supply worries.
* Cotton contracts for December CTZ3 rose 1.33 cent, or 1.57%, to 86.25 cents per lb at 1:50 p.m. EDT (1750) GMT. The contract is down about 1% for the week.
* "On the supply side, U.S. small crops tend to get smaller, and this seems to be the case for now," said Valentin Olah, cotton risk management consultant at StoneX Group.
* The U.S. Department of Agriculture (USDA) in its October World Agricultural Supply and Demand Estimates (WASDE) report on Thursday reduced U.S. production in 2023/24 to 12.8 million bales, citing lower yields in Texas.
* The market is seeing a delayed reaction to the WASDE report which was quite friendly in both U.S and world ending stocks, said Rogers Varner, president of Varner Brokerage, in Cleveland.
* The WASDE report projected 2023/24 world cotton ending stocks relative lower to last month and said U.S. ending stocks are 100,000 bales lower.
* While a weekly USDA sales report showed net sales of 43,400 running bales of cotton for 2023/2024, they were down 82% from the previous week and 63% from the prior four-week average.
* In the grains market, Chicago soybean futures extended gains after the U.S. government lowered its U.S. crop forecast below expectations, while wheat rose 1.5% after a lower projection for global supplies. GRA/
* Oil prices extended losses for a third session, dragged down by a larger-than-expected crude and gasoline stockbuild in the United States. Lower prices make the cotton substitute, polyester, cheaper.O/R
Reporting by Daksh Grover in Bengaluru; Editing by Maju Samuel