Cotton futures rose to a two-week high on Thursday, as expectations of unfavorable weather conditions and positive export sales data offset a slightly bearish US government planting intentions report. The front-month May contract recovered after falling 0.38 cent, or 0.7 percent following the report, which forecast that US farmers will plant 9.562 million acres of cotton this year, slightly above trade expectations at 9.412 million acres.
"We anticipate that wet conditions, on top of heavy moisture profiles, would create challenges to increasing area on the year," Rabobank analysts said in a note, adding that dry weather would be required to meet the magnitude of USDA's acreage expansion forecasts. The market also took stock of the US export sales report, which showed sales of upland cotton totalled 86,400 running bales for the week ended March 24, up 2 percent from the previous week. The front-month May contract on ICE Futures US settled up 0.77 cent, or 1.34 percent, at 58.44 cents per lb after hitting 57.01, the lowest in about two weeks.
The dollar index was down 0.23 percent. The Thomson Reuters CoreCommodity CRB Index, which tracks 19 commodities, was down 0.26 percent. Total futures market volume rose by 10,098 to 36,626 lots. Data showed total open interest gained 1,844 to 218,354 contracts in the previous session.