Cotton gained for a third straight day on concern supply may trail demand as drought reduces crops in the U.S., the world’s largest shipper. Orange juice rose.
The U.S. Department of Agriculture cut its outlook for domestic cotton production yesterday. It was the first time the government lowered its June forecast from May since 1998. Crops in Texas, the biggest producing state, are suffering after the driest May since 1956, according to an agricultural program at Texas A&M University in College Station. Prices are up 69 percent in the past year.
“I think more and more the focus is going to be on how much of the U.S. crop is going to be available,” said Louis Barbera, a broker with VIP Commodities in New York. “The big thing about cotton is the consumption. That’s going to be the thing that drives it.”
Cotton for December delivery gained 0.66 cent, or 0.5 percent, to $1.3365 a pound on ICE Futures U.S. The price fell 3.6 percent this week.
Orange-juice futures for July delivery increased 1.2 cents, or 0.7 percent, to $1.849 a pound on ICE.