NEW YORK (Dow Jones)--Cotton prices climbed Wednesday as speculative fund
traders bought back into the rallying market on ideas that demand will continue
to eat away at supplies.

ICE Futures U.S. most-active May cotton settled up 112 points, or 1.3%, at
82.97 cents a pound.

Cotton prices are trading near two-year highs as lower world production met
growing demand in the ongoing 2009-10 season. Futures have risen 21.5% since
Feb. 5, boosted by expectations that growing world demand would boost U.S.
exports and draw on available supplies amid a lower-than-expected harvest.

"Cotton just continues to chug right along--it's been a demand-led market,"
said Jack Scoville, vice president at Price Futures Group in Chicago.

Prices eased slightly Tuesday--only the third weaker settlement in the last
17 sessions, as some traders took profits and others were reluctant to buy in
light of the recent steep rally.

Scoville said May cotton will likely trade between Monday's 84.60 high and
support at 80-81 cents as the market looks for more cues.

Traders will be looking to weekly U.S. cotton export-sales data, scheduled to
be released at 8:30 a.m. EST Thursday, for cues on recent cotton demand. Prices
have risen substantially from the levels where mills bought the last time
cotton prices dipped. Traders are also awaiting the monthly U.S. Department of
Agriculture report due out March 10.

The cotton market is still fully engaged in the annual fight for planted
acreage, the pre-planting battle between row-crop prices, said Sid Love,
analyst at Kropf & Love Consulting in Overland Park, Kan. Producers look at the
prices for fall's corn and soy, among other crops, to determine which will be
most profitable to plant in the coming months. Fall futures for Chicago Board
of Trade corn and soy rose Wednesday.

High prices now will "buy" more cotton acres and lead to stronger production
in the coming season, beginning Aug. 1.

The USDA's most recent estimate for cotton plantings is 10.5 million acres,
up 15% from last year and the largest year-on-year increase since 1995. A
revision to the estimate is scheduled for release on March 31.

ICE daily cotton stocks increased by 26,017 500-pound bales Tuesday to total
585,181 bales, with 79,900 bales awaiting review, according to exchange data.

ICE cotton open interest--the number of active positions left at the end of
the session--increased by 5,170 positions Tuesday to total 180,177, according
to the exchange.

Volume was estimated 14,630 lots. In options, approximately 10,698 calls and
3,368 puts traded, according to exchange data.

Close Change Range
Mar 83.19 +129 pts 82.82-83.19
May 82.97 +112 pts 81.75-83.40
Dec 75.07 + 97 pts 74.00-75.12