NEW YORK: Cotton futures finished mostly lower on Thursday in profit-taking off a near two-month high, as players prepared for a long-anticipated government report on cotton sowings in 2012, analysts said.
The benchmark May contract on ICE Futures US fell 0.49 cent to close at 93.07 cents per lb, after dealing from 93.07 to 94.39 cents. Wednesday's close at 94.03 cents was the loftiest on the spot cotton contract since Feb. 7.
Volume came to around 16,850 lots, about 15 percent over the 30-day norm, Thomson Reuters data showed.
"I think they're waiting (for the report)," said Sharon Johnson, senior cotton analyst at commodities brokerage Penson Futures in Atlanta.
She was referring to the annual potential plantings report from the US Agriculture Department, due at 8:30 a.m. EDT (1230 GMT) on Friday.
A prime catalyst for the move up was tight supplies in the old-crop May and July cotton contracts.
While world 2011/12 cotton ending stocks were pegged by the US government at a hefty 62.32 million 480-lb bales, Johnson and other traders said the market was discounting the bearish tint of the figure.
She said up to 40 percent of global stocks were in the "hands of China and India", meaning cotton was available only for their mills and "not accessible" for the world market.
The tight supply situation is thus reflected only in May and July, with the new-crop December cotton contract adding 0.03 cent to close at 90.61 cents.
A Thomson Reuters survey of industry participants showed they expect US 2012 cotton sowings to be down about 13 percent from last year, or about 12.74 million to 12.76 million acres, because of higher prices in grains such as soybeans.
In early February, the industry group National Cotton Council had pegged US 2012 cotton sowings at 13.63 million acres (5.5 million hectares), down 7.4 percent from 2011 cotton plantings of 14.72 million acres.
The main reason for the switch in acres, traders say, is the higher price of grains such as soybeans compared with cotton.
Open interest, an indicator of investor exposure, fell for the third day in a row after rising for 12 straight sessions. It stood at 187,509 lots as of March 28.
On Friday, open interest in the cotton market was at 190,909 lots, the highest since Feb. 9, ICE Futures US data showed.
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