NEW YORK, July 21 (Reuters) - Cotton futures ended lower
Thursday on investor sales as the prospect of a debt deal in
the EU and the U.S. failed to fire up market participants who
feel the deals would just postpone solving urgent budget
problems in both regions for another day, analysts said.

Keith Brown, president of commodity firm Keith Brown and Co
in Moultrie, Georgia, said news on the deal in the EU and in
the U.S. looks like a 'kick the can down the road' agreement
which does not really solve the macro issues for both areas.

The key December cotton futures on ICE Futures U.S.
dropped 2.12 cents to finish at 98.63 cents per lb, trading
from 96.75 cents to $1.015.

On Monday, the contract finished at 96.46 cents in the
lowest close for the second-position contract since early
October 2010, Thomson Reuters data showed.

Business was light. Total market volume hit around 10,800
lots at 2:51 p.m. EDT (1851 GMT), over 40 percent below the
30-day norm, Thomson Reuters preliminary data showed.

Cotton was also pressured by the weekly export sales report
from the U.S. Agriculture Department.

USDA said only a mere 31,200 running bales (RBs, 500-lbs
each) of upland cotton were sold by U.S. exporters, which
traders said in an indication of how weak fiber demand has been
for several weeks.

'We're trying to limp along here and finish out the month
(of July),' said Brown, adding many players are looking toward
the USDA's August supply/demand report to provide market
direction.

The August USDA report is the first for the 2011/12
marketing year (2011/12) and is also the first in the season to
be based on detailed government surveys since the July supply
data is based on estimates by USDA analysts.

Volume traded on Wednesday stood at 16,319 lots, slightly
over 10 percent behind the 30-day average, ICE Futures U.S. and
Thomson Reuters data showed.