NEW YORK, March 23 (Reuters) - U.S. cotton futures settled
lower Wednesday on investor profit-taking as the failure to
extend the market's advance prompted players to liquidate
positions in fiber contracts, analysts said.

The key May cotton contract on ICE Futures U.S. fell
4.09 cents to end at $2.0187 per lb, dealing between $2.0997
and $1.9896, which was down the 7-cent trading limit.

The volume stood at around 24,000 lots, about a fifth below
the 30-day norm, Thomson Reuters preliminary data showed.

Open interest in the market, an indicator of investment
exposure, stood at 176,065 lots as of March 22, a level that is
above an 8-month low, data from ICE Futures U.S. showed.

'We reached the (topside) technical points and
profit-taking set in,' Mike Stevens, an independent analyst in
Louisiana, said.

Lou Barbera, a trader for brokerage VIP Commodities, said
the market also faced some pressure from talk that some cotton
sold to China may be coming back to the exchange after sales
were canceled and he also pointed to a buildup in certificated
cotton stocks.

Traders said cotton pushed higher in an attempt to get past
$2.10, basis May, where some automatic pre-placed computer buy
orders were believed to be sitting, but the attempt petered
out. 'The whole thing just ran out of gas,' one trader said.

Next week, the U.S. Agriculture Department will be
releasing its closely watched annual potential plantings report
on Thursday for crops such as cotton, corn, soybeans and wheat,
among others.

The USDA report is the first government survey of likely
plantings for major row crops in 2011. Despite the rally in
cotton to record highs, the fiber has to compete for acreage
against similarly high-priced grains this year.

Analytical firm Informa Economics projected on Friday U.S.
farmers will plant 13.13 million acres to cotton, a level that
would be the highest in 5 years.