NEW YORK, May 31 (Reuters) - U.S. cotton futures finished
at a four-week high Tuesday on investor buying as a historic
drought did not let up in the key growing state of Texas during
the long holiday weekend, brokers said.

The cotton market was closed Monday for U.S. Memorial Day.
Forecast Telvent DTN said Texas was dry the past four days and
conditions will remain just as hot and dry through the week.

'I think the weather in Texas is what really kicked
(cotton's rally) off,' said Mike Stevens, an independent cotton
analyst in Louisiana.

The benchmark December cotton futures on ICE Futures
U.S. went up the 6-cent limit to finish at $1.355 per lb, with
the day's low at $1.30. It was the highest settlement for the
third-position cotton contract since May 4.

Based on that third-position contract, cotton posted a gain
of 3.49 percent in the month of May.

Spot July cotton also went up the 6-cent limit to
close at $1.5867.

'The forecast chance of rain in West Texas on Sunday
failed, as did the forecast chance on Monday,' said a daily
commentary by Flanagan Trading Corp.

The worst drought in a century in Texas may force farmers
there to abandon up to a third of the crop unless rains
drenched the state for days soon.

(Graphic of Texas cotton harvested:
http://r.reuters.com/cyq79r)

Another key factor for cotton's surge is the weaker dollar,
which would generally lure investor funds into commodities,
traders said.