Keith Brown DTN Contributing Cotton Analyst    

The cotton market was sharply higher Thursday as frenzied buying from speculators and textile mills nearly pushed the July contract to its special 7.00-cent limit. Meanwhile, new crop December traded through the all-important psychological levels of $1.25. Besides the prevailing hot-and-dry growing conditions in West Texas, there were rumors that India may, repeat may, halt the exportation of its cotton. The Indian crop saw very low output as episodes of insect infestations and adverse weather events deteriorated its 2021-22 crop.    

Friday, the CFTC will issue its weekly traders update. Last week saw the closely watched managed-money funds as net sellers of some 4,000 contracts, lowering their net long position to 73,500 contracts. Of course, Thursday's action will not be accounted for until Friday week.    

Also supporting the cotton market was a sharply higher Dow Jones, new contract highs in the energies and Chinese COVID-19 closures.    

Traders are mindful May cotton expires next week, and some think "where" it expires will greatly influence the July contract.    

Weather-wise, the one- to five-day forecast for West Texas calls for moderate to light rainfall in the region, while the six- to 10-day shows normal to above-normal chances of precipitation. The eight- to 14-day outlook is indicating normal to below-normal opportunities    

Heading into Friday's trade, July cotton is up 12.17 cents on the week, up 15.61 cents on the month and up 39.80 cents for the year.    

Thursday, May cotton settled at 153.08 cents, up 7.00 cents, July closed at 147.68 cents, up 7.00 cents and December finished at 125.00 cents, 2.61 cents higher; estimated volume was 33,984 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

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