NEW YORK (Dow Jones)--Cotton prices consolidated lower Friday after a rally
driven by the diminishing availability of the fiber.

Nearby cotton for July delivery ended 0.97 cent, or 1%, lower at 81.54 cents
a pound on ICE Futures U.S. Most-active December cotton settled 0.13 cent, or
0.2%, lower at 78.94 cents a pound.

Despite Friday's losses, July futures have risen 6% this week. Stocks of
world cotton are dwindling and no bulk of fresh supplies will be available
until the fall. The U.S. Department of Agriculture confirmed the expectations
of many market participants with data projecting world cotton supply would fall
13% short of demand for the current season. Next season's shortfall is still at
5%. World cotton demand has been rebounding in line with a global economic
recovery, which tends to spark textile demand that was put off during hard
times.

Analysts said cotton is almost impossible to find at the moment, though
prices eased Friday as a relatively small amount--19,212 500-pound bales--of
cotton was withdrawn from exchange stocks overnight for sales on the cash
market.

"The market is just stalling and catching its breath," said Andy Ryan, a risk
management consultant at FCStone in Nashville. "The lack of cotton in the real
world is going to catch up with the market next week."

Prices in China--the world's top cotton producer and importer as well as
textile manufacturer--have rallied this week as well, and merchants the world
over are searching for available bales.

The daily Cotlook A Index--a barometer of world cotton prices--was listed as
"nominal" for much of the week. The listing means that insufficient cotton was
offered worldwide to compile the usual normal composite.

"Not since the mid-90s have we been in such a tight situation and the new
crop can't come soon enough for mills in dire need of cotton," said Peter Egli,
director of risk management at Plexus Cotton Ltd.

Traders will continue to watch growing conditions for next season's U.S.
cotton crop that will be harvested in the fall.

ICE daily cotton stocks increased by 2,439 500-pound bales Thursday to total
798,487 with decertification orders, according to exchange data.

ICE cotton open interest--the number of active positions left at the end of
the session--increased by 2,009 positions Thursday to total 177,007, according
to the exchange.

Volume was estimated at 4,1362 lots. In options, approximately 4,760 calls
and 3,260 puts traded, according to exchange data.

Close Change Range
Jly 81.54 -0.97 81.49-82.70
Oct 78.53 -0.11 78.50-79.18
Dec 78.94 -0.13 78.61-79.15