* Nearly 11,000 switches from July to December during
session
* July ends down, December finishes up

June 13 (Reuters) - Cotton futures were mostly higher on
Wednesday, brushing aside negative USDA supply/demand news of a
day earlier and returning to the mechanics of the rollover
period that hit the spot July futures and bolstered the December
contract by the close.
Nearly 11,000 switches were said to have taken place on
Wednesday out of July cotton into the December.
"That doesn't include any outright trades that were done,"
said Jobe Moss, of MCM Inc in Lubbock, Texas.
"I think there were some funds that were really short July
and long December, over the last couple of weeks, and in the
last week July has come back much more than December," he said.
The active December cotton contract on ICE Futures
U.S. finished up 1.57 cent, or 2.28 percent, at 70.41 cents per
lb. It traded between 68.70 and 71.16 cents, its highest since
June 8. Wednesday's contract volume was healthy at 19,556 lots.
Spot July futures slipped 48 cents, or 0.64 percent,
to end at 75.09 cents. The session marked a technical inside day
compared to the previous range, containing a higher low than
Tuesday's at 74.25 and a lower high at 76.35 cents.
July volume came to 15,571 lots. The total cotton tally was
robust at 38,178 lots and about 26.0 percent above the 30-day
norm, though less than the 46,612 lots traded in Tuesday's
selloff, Thomson Reuters data showed.
Open interest fell by 4,511 lots to 194,240 lots on Tuesday,
with the July open interest at 47,763. Brokers said there were
about 10,873 July-December rollover trades.
Wednesday was the last day for the largest index funds to
complete their switches, which drove up the volume. Though
roughly 37,000 July contracts remain on the board, they will
likely be rolled at a less frenzied pace. The contract expires
on July 9.
Moss said, he thought merchants who needed cotton would not
likely price it off of spot July, because of a run up of more
than 10 cents since it slid to a contract low on June 4 at 66.10
cents a lb. He noted that July cotton got up to nearly 700
points over the December contract as prices climbed off their
long-term lows.
As July first notice day approaches on June 25, some brokers
think there may be speculative players who have been running the
July price up to squeeze out anyone who may still be holding a
short position.
On Tuesday, cotton prices fell after the U.S. Agriculture
Department's monthly supply report forecast world 2012/13
(August/July) cotton ending stocks at a record 74.51 million
(480-lb) bales, up 1.03 percent from last month's estimate of
73.75 million.
The agency also cut its world consumption estimates for both
the 2011/2012 crop year as well as for next year.