Finding commodities ETFs and ETNs that have disappointed investors this year is not difficult. Actually, it has been two previous investor favorites, gold and silver, that have created many of those disappointments. The good news is all is not lost when it comes to the 2013 commodities.

Even though hard commodities such as gold and silver and “softs” such as coffee are being taken to the woodshed, there is at least one commodity ETN standing tall: The iPath DJ-UBS Cotton TR Sub-Inddx ETN (NYSEArca: BAL). Year-to-date, BAL has surged 15.5% compared to a 9.34% loss for the PowerShares DB Agriculture Fund (NYSEArca: DBA). [Chart of the Day: Cotton ETN]

More upside could be in store due to surprisingly robust Chinese demand, which helps because the U.S. cotton crop is expected to be strong.

“Commodity bulls are taking a fancy to the Cotton market, as lower production estimates and a drop in carryout sent prices to 1-year highs,” according to OptionsExpress. “The June crop production and supply/demand report was the latest catalyst for Cotton’s up-move, with the USDA lowering its estimate for this season’s production to 13.50 million bales, which is down 0.5 million bales from last month’s report, as dry conditions in Texas, the leading Cotton producing state, are expected to lower average yields.”

Add to that, “Demand for cotton was also strong from ‘countries that are enjoying surging exports of cotton yarn to China”, thanks to the high-price regime that China’s own mills are operating at, Agrimoney reports, citing Macquarie

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