Cotton hits over 1-month peak on China demand, strong export sales

ICE cotton futures jumped over 3% on Thursday to hit a more than one-month peak, buoyed by robust demand from top consumer China and strong export sales data.

* Cotton contracts for July (CTc1) rose 2.32 cents, or about 3%, to 81.70 cents per lb by 13:22 p.m. ET (1722 GMT).

* The contract hit its highest since April 16.

* The market has gone up because of "extremely strong export sales ... and they don't have much inventory left for sale in current crop," said Peter Egli, director of risk management at British merchant Plexus Cotton.

* "The Chinese market has gone up in the last five days and they're once again the strongest buyer in the report."

* The U.S. Department of Agriculture's (USDA) weekly export sales report showed exports of 204,100 running bales (RB).

* Both net sales and exports increased primarily for China. Net sales for 2023/24 for the biggest consumer of U.S. cotton totalled 104,400 RB and for 2024/25, it stood at 13,200 bales, data showed.

* Exports to China were around 84,600 bales, according to the report.

* The report also showed net sales of 47,900 RB for 2024/25 and 202,900 bales for 2023/24.

* "We've gone up because Brazil and China have announced they have lost some production and the market is oversold," said Keith Brown, principal at cotton broker Keith Brown and Co. in Georgia.

* Flooding in the far south of Brazil could hamper the upcoming sowing of multiple crops.

* Cotton jumped over 3% on Wednesday to trade limit up as traders covered short positions.

* Elsewhere, Chicago wheat consolidated following a 10-month peak a day earlier while corn and soybeans edged up.

* Chinese importers are believed to have purchased at least two shipments of soybeans from the United States in the past few days.