US cotton futures closed lower Friday on investor profit-taking and players began looking toward release of a key government plantings report toward the end of next week, analysts said. The key May cotton contract on ICE Futures US dropped 4.33 cents to end at $2.0449 per lb, dealing from $2.0263 to $2.1116. On the week, the market is up 2.7 percent.
The market faltered when it tried to push its way beyond $2.10 and maybe $2.15, basis the key May contract, said Mike Stevens, an independent cotton analyst in Louisiana. "It ran into technical resistance is has been plagued with all week," he said. "It's Friday and so it's time to bank the profits for the week."
Volume traded stood at about 16,000 lots, 40 percent below the 30-day norm, Thomson Reuters preliminary data showed. The level of investor interest in the market hit its highest level in a month as it stood at 177,933 lots as of March 24, the highest since February 23, ICE Futures US data showed.
The market is still fretting about the drought-like conditions afflicting Texas, the top cotton-growing state in the country. But attention next week will be dominated by a report on March 31 from the US Agriculture Department on potential plantings 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 fibre has to compete hard for acreage against similarly high-priced grains this year. Analytical firm Informa Economics projected on Friday US farmers will plant 13.13 million acres to cotton, a level that would be the highest in five years.