By Christian Berthelsen

Cotton prices edged up Tuesday as monthly U.S. production estimates fell slightly.

Cotton futures rose 0.2% to settle at $61.59 cents a pound on the ICE Futures U.S. exchange. Cotton has been treading water over the last year amid a collapse across most of the rest of the commodity complex, and has gained 1% in the last week. Financial investors in the cotton market are strongly bullish, with so-called long bets on rising prices by more than four-to-one.

Traders have been watching official data closely for clues about how much supply may eventually hit the market after a topsy-turvy growing season that saw both heavy rains and high temperatures, raising questions about whether the U.S. would see bumper crops or a shortfall.

John Payne, a strategist at brokerage Daniels Trading in Chicago, said the data confirmed that supply-and-demand fundamentals are "not getting worse," which bolsters bullish sentiment about the market.