NEW YORK (Dow Jones)--Cotton consolidated lower Thursday, following grains
prices down as competition for acres picks up amid the fast-approaching spring
planting season.

Cotton for May delivery on ICE Futures U.S. settled down 144 points, or 1.8%,
at 78.77 cents a pound.

Despite those losses, the contract is up 15.4% since Feb. 5 amid ideas that
demand from textile mills would burn through available supplies before the end
of July, when the 2009-10 marketing year ends. May futures touched 84.60 as the
market charted two-year highs March 1.

A U.S. Department of Agriculture crop production supply and demand report
confirmed tighter cotton stocks and rising consumption, but now the market is
turning to outlooks for spring plantings as the season begins.

Weaker prices in Chicago Board of Trade soy and wheat spilled over into
cotton Thursday, said Rogers Varner Jr., president of Varner Brothers, a
brokerage in Cleveland.

Producers scan futures markets when deciding which crops to plant. The late
fall contract--December, in the case of cotton--is the moving estimate for the
price they'll receive during the harvest.

Preliminary USDA outlooks pegged 2010 cotton acreage at 10.5 million acres,
up from 9.15 million last year. Recent high prices are likely to entice farmers
to plant the crop, the USDA said.

Overall, the cotton market continues to consolidate lower after the February
rally, which was fueled by buying from speculators, which have no use for the
underlying commodity. Prices are relaxing toward levels that are more
affordable to textile mills.

Mill buying is likely to come in at 75 cents basis May, Varner said.

The next technical support target for May futures is 76.80, said Tom
Mikulski, senior market strategist at Lind-Waldock in Chicago.

"Seeing the market pull back from a run like that is a healthy thing,"
Mikulski said.

ICE daily cotton stocks increased by 15,620 500-pound bales Wednesday to
total 675,857 bales, with 44,775 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 399 positions Wednesday to total 186,456, according
to the exchange.

Volume was estimated at 13,385 lots. In options, approximately 5,141 calls
and 3,381 puts traded, according to exchange data.

Close Change Range
May 78.77 -144 pts 78.70-80.27
Jly 79.28 -137 pts 79.25-80.60
Dec 75.13 - 36 pts 74.25-75.45