NEW YORK (Dow Jones)--Speculative fund selling drove ICE Futures U.S. cotton
to 10-week lows Monday despite commercial buying at the bottom of the trading
range.

March cotton settled down 111 points or 1.5% at 69.96 cents a pound, not far
from the 69.81 low.

Selling by speculators, who have no use for the underlying commodity, pulled
March cotton to its lowest point since Nov. 12. Futures have been backing off
of 16-month highs hit Jan. 4. Analysts say cotton prices are underpinned by the
tight world supplies and demand that improves with a rebounding economy. These
factors supported cotton noticeably through the last quarter of 2009.

Despite losses in recent sessions, analysts say commercial buying from the
cotton merchants and end users is stanching losses at recent lows.

"Every time we have a steep break, [commercial] buying comes in," said Keith
Brown, principal of Keith Brown & Co. in Moultrie, Ga.

March futures have technical support at 69.50, said Andy Ryan, management
consultant at FCStone in Nashville. Ryan noted funds likely sold to take
profits or based on cues from technical charts.

A technical analyst said the close below 70 cents preps March cotton for a
slide to as low as 65 cents.

Data from the Commodities Futures Trading Commission shows cotton's recent
losses came as speculative fund traders, such as money managers, reduced net
length in ICE cotton to 44,945 lots in the week to Jan. 19 from 46,727 lots the
week before. Traders shed 3,432 long lots as well as 1,650 shorts. Swap dealers
also shed net length, while traders with other reportable positions more than
doubled net length to 12,755 lots.

ICE daily cotton stocks increased by 4,049 500-pound bales Friday to total
447,947 bales with 40,024 bales awaiting review, according to exchange data.

ICE cotton open interest-–the number of active positions left at the
end of the session--decreased by 379 positions Friday to total 173,247,
according to the exchange.

Volume was estimated 17,717 lots. In options, approximately 2,340 calls and
1,048 puts traded, according to exchange data.

Close Change Range
Mar 69.96 -111 pts 69.81-71.56
May 71.23 -108 pts 71.07-72.80
Dec 72.01 - 91 pts 71.89-72.90