U.S. Department of Agriculture Reports Lower Production Expectations in June

The drought prompted the U.S. Department of Agriculture (USDA) to reduce its 2011/2012 US cotton production forecast from the 18 million export package in May to 17 million export packages.

This is the first time since 1998 that the US Department of Agriculture lowered its cotton production forecast in its June report.

Stevens and other traders said that investors did not care about the pressure caused by the stock market.

A report by private weather forecasting agency TelventDTN stated that it is expected that there will be more dry and hot weather in Texas until the 14th this weekend.

Texas drought caused serious investor follow-up buying, and ICE futures closed higher on the 10th. Independent analyst Steven Stevens (MikeStevens) said, “The weather premium continues to be built into cotton prices, suggesting that market participants are reluctant to short futures before the weekend.”