NEW YORK (Dow Jones)--Cotton prices fell Thursday as bearish outside
conditions curbed the market's recent demand-driven rally.

Nearby May cotton on ICE Futures U.S. settled 0.62 cents or 0.7% at 82.42
cents a pound. The most-active July contract settled 0.33 cents or 0.4% lower
at 84.82 cents a pound.

Cotton prices eased back from two-year highs hit Wednesday by the May
contract. Futures rallied as the already tight world supply situation was
jolted by an export ban from India, the world's No. 2 exporter behind the U.S.
India said it planned to meet the export target set before shipments were
cutoff, but uncertainty remains about shifts in demand and available supplies.

"The final affect of the Indian moratorium on [export] registrations is not
in place--the market's going to regroup and make another run at the highs,"
said Keith Brown, principal of Keith Brown & Co. in Moultrie, Ga.

Cotton gains were capped by bearish outside market conditions Thursday. The
dollar rose on risk aversion amid ongoing Greek debt concerns. Metals and sugar
took losses along with cotton as the strong greenback makes those contracts
pricier in other currencies. Equities were also weaker as cotton closed.

Traders are now looking to May first notice day Monday for demand cues.
Physical cotton deliveries against the May futures contract will indicate
demand as ICE cotton stocks against the May and July futures contracts hold a
mass of available supply.

World cotton demand has rebounded in the last year from after a rough period
that coincided with slowed global economic growth. Consumers cut textile
purchases when budgets are tight, but linens and clothing are among the first
items bought when finances ease. In a year of weaker-than-expected production,
the world cotton demand is expected to outpace demand by 14% in the season
ending July 31.

The U.S. is the No. 3 cotton producer behind China and India. China is also
the leading cotton importer and textile manufacturer.

ICE daily cotton stocks increased by 30,442 500-pound bales Wednesday to
total 957,439 bales with 47,042 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 1,863 positions Wednesday to total 184,570, according
to the exchange.

Volume through the close was estimated 27,793 lots. In options, approximately
4,559 calls and 9,017 puts traded on the floor in the same timeframe, according
to exchange data.

Close Change Range
May 82.42 -62 pts 82.05-83.78
Jly 84.82 -33 pts 84.37-85.97
Dec 77.19 +17 pts 76.70-77.28