March 16, 2003	Sunday	Muharram 12, 1424

NEW YORK, March 15: NY cotton futures finished at a fresh two-year zenith Friday on steady speculative and trade buying in the market, although operators feel a near-term top is likely in cotton.

Key May shot up 0.71 cent to end at 60.02 cents a lb, trading from 59.05 to a new life-of-contract high of 60.50 cents. Cotton settled at its highest level since early in 2001, when it was hovering from 60-62 cents. It is also the first time cotton has ended above the psychological 60-cent level in two years.

July rose 0.70 to 60.69 cents. Except for one contract, increases in back months were far more modest as they ranged from 0.05 to 0.15 cent.

Sharon Johnson, cotton expert for Frank Schneider and Co. Inc. in Atlanta said steady waves of trade and speculative buying shoved the market ever higher.

She said cotton prices though may be within 100 points of the top and other dealers said futures are already heavily overbought, making them vulnerable to a correrction.

Frank Weathersby of brokers Affinity Trading in Fort Walton Beach, Florida said cotton prices may be poised for a 2-cent pullback, but the overall tone remains positive and cotton could well grind its way higher longer-term.

Futures are critically overbought now and a sharp correction is possible at any time, said the daily commentary of brokers Flanagan Trading Corp. in North Carolina.

Cotton started working its way higher after a brief probe of the day’s lows. Late scale-up trade and speculative sales pared the market’s gains, brokers said.

The market paid little heed to the reported estimate by analytical firm Sparks Cos. that it had pegged US cotton plantings at 14.395 million acres.

The number was ignored by the cotton futures market, since most of the trade felt it was within expectations that US 2003 cotton sowings would range from 14.2-14.4 million acres.

Sparks Cos. officials had no comment on the reported release of their estimate.

On a technical level, analysts said the market will eventually take aim at the 61.58 cents level, basis May, which represents a 38 per cent retracement of the move from the high posted in 1995 and the 29-year low cotton futures saw in Oct. 2001.

Short-term, technical parameters indicate resistance in the May contract at 60.40 and 60.85 cents, traders said. Support in the contract was pegged at 59.80 and 58.80 cents, they said.

Floor sources said estimated volume stood at 15,000 lots, versus the prior tally of 10,791 lots. Open interest in the cotton market rose 1,430 lots to 94,162 lots as of March 13. —Reuters