NEW YORK (Dow Jones)--Cotton prices rose Thursday in correction from a spate
of fundamentally inspired lossess.

Nearby cotton for October delivery settled 1.27 cent, or 1.6%, higher at
78.52 cents a pound on ICE Futures U.S. The most actively traded December
contract settled 0.12 cent, or 0.2%, higher at 73.47 cents a pound.

The U.S. cotton crop is projected 50% higher in 2010 than the year before.
Rebounding texile demand drove prices higher as the economy recovered. Farmers
planted more of the crop as those high prices made it an attractive investment.
But now prices are falling on outlooks for a big supply and questionable demand
to meet it on ideas of a flagging economy. Consumers purches less textiles when
finances are tight.

Buying triggered by technical chart indicators gave December cotton prices a
bounce after the market hit its lowest levels since late February. The contract
is the benchmark for the fall harvest. It has fallen 4% since July 1 as
speculative traders, like banks and hedge funds, sell bullish bets on forecasts
the economy will curtail consumption.

"The demand is elastic; the crop is big and getting bigger."," said Mike
Stevens, an independent cotton broker and analyst in Mandeville, La.
"Supply-side bulls don't really have a leg to stand on."

Cotton came under early pressure from weak export sales, indicating flagging
demand, said Boyd Cruel, senior softs analyst at Vision Financial Markets in
Chicago.

Lower equities prices also added a bearish angle to cotton trade as they
portend weaker cotton demand, Cruel said.

Stevens said December prices are stuck in a range of roughly 72-75 cents in
the near term.

ICE daily cotton stocks decreased by 5,825 500-pound bales Wednesday to total
201,026 with 2,819 decertification orders, according to exchange data.

ICE cotton open interest--the number of active positions left at the end of
the session--decreased by 366 positions Wednesday to total 153,880, according
to the exchange.

Volume was estimated 8,379 lots. In options, approximately 6,217 calls and
1,789 puts traded, according to exchange data.

Close Change Range
Oct 78.52 +1.27 77.10-78.99
Dec 73.47 +0.12 73.06-74.29
Mar 74.40 +0.10 74.05-75.15