Projected U.S. production rose by 262,000 bales as gains in the Southwest and other regions more than offset a smaller crop in the West. World ending stocks projected down 1.6% as historical revisions cut beginning stocks 900,000 bales.

Cotton futures reversed off an 11-session high to settle modestly lower Thursday, as traders digested USDA monthly supply-demand forecasts for a larger U.S. crop and a 1.6% reduction in world ending stocks.

December closed down 34 points to 68.29 cents, near the low of its 130-point range from up 85 points at 69.48 to down 45 points at 68.18 cents. March settled down 32 points at 68.54 cents, trading within a 32-point range from 69.67 to 68.34 cents.

Volume declined to an electronically estimated 63,300 lots from a final 73,007 lots the previous session when spreads accounted for 45,334 lots or 62%, EFS 6,177 lots and EFP 21 lots.

Projected U.S. all-cotton production rose by 260,000 bales to 21.38 million from the October forecast, with gains in the Southwest and other regions more than offsetting a smaller crop in the West. A cut of 200,000 bales had been expected.

Estimates of exports and domestic mill use were unchanged at 14.5 million and 3.35 million bales, respectively. Ending stocks are estimated at 6.1 million bales, up 300,000 bales from a month ago, with a stocks-to-use ratio of 34% projected at the highest since 2008-09.

The USDA forecast an average marketing year price at the farm level within a range from 60 to 66 cents, with the midpoint of 63 cents up 3 cents from the October projection, reflecting prices to date.

Yield is forecast at a record high 900 pounds per acre, up 11 pounds from last month, 33 pounds from last year and 61 pounds from the five-year average. Upland production is forecast at 20.65 million bales, up 24% from 2016. The Pima forecast of 727,000 bales was carried forward from an earlier estimate.

By regions, upland estimates rose by 25,000 bales from a month ago to 4.855 million in the Southeast, 50,000 to 4.485 million in the Mid-South, 214,000 to 10.385 million in the Southwest and declined 28,000 bales to 925,000 in the West.

Estimates were up 100,000 bales to 9.1 million for Texas and unchanged at 2.4 million bales for Georgia, up from last year’s 8.1 million and 2.18 million bales, respectively. If realized, yield estimates for Arkansas, Florida and Missouri will be record highs.

Globally, USDA cut beginning stocks 900,000 bales to 88.67 million, raised production 600,000 bales to 121.46 million, boosted consumption 1.24 million bales to 119.25 million and reduced ending stocks 1.5 million bales to 90.88 million. Revised historical data resulted in the decline in beginning stocks.

Larger expected crops in China and the United States offset a 200,000-bale decline forecast for Australia. Increases in consumption of 300,000 to 550,000 bales were forecast for Uzbekistan, China and Bangladesh. Estimates for China were raised 500,000 bales for the crop, 200,000 bales for imports, 500,000 bales for mill use and 200,000 bales for ending stocks to 39.67 million.

The world trade forecast dropped 180,000 bales to 38.04 million as a 400,000-bale decline in expected exports by Uzbekistan was only partly offset by a 100,000-bale hike for Brazil and smaller increases elsewhere.

Futures open interest gained 770 lots to 236,707 on Wednesday, with December’s down 8,694 lots to 75,894 and March’s up 4,983 lots to 109,309. Certified stocks increased 2,600 bales to 41,922.