NEW YORK, July 2: Cotton futures settled mixed on Monday as the market seemed to be taking a breather after a sizzling rally sparked by a government plantings report last week, analysts said.

The New York Board of Trade's key December cotton contract added 0.10 cent to close at 63.43 cents per lb, dealing from 63.20 to 63.93 cents. The rest ranged from 0.50 cent lower to 0.65 cent firmer.

IntercontinentalExchange's NYBOT electronic cotton market showed the December contract up 0.27 cent at 63.60 cents.

Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia, said the market is showing signs it is “near a top for the time being” and may need to consolidate for now before deciding on its next move.

The market rallied strongly last Friday when the US Agriculture Department pegged US cotton sowings in 2007 at an 18-year low of 11.1 million acres.

Based on expectations of harvested cotton acreage and a yield of 820 lbs/acre last year, the US cotton crop may reach only 16.8 million (480-lb) bales, down sharply from the June USDA production report estimate of 18.8 million bales. In 2006/07, the US harvested 21.59m bales of cotton.

The impact of the much lower US cotton plantings number will likely be seen when the USDA issues its monthly production report on Thursday, July 12.

An initial burst of speculative buying buoyed fibre contracts, but the impetus from that move soon petered out, dealers said. “The specs tried to run it up but the trade was there to put a cap on it,” one said.

Brokers Flanagan Trading Corp. sees resistance in the December contract at 63.50 and 64.10 cents, with support at 62.75 and 62 cents.

Floor dealers said final estimated open-outcry volume stood at 11,500 lots, from the prior volume of 4,127 lots. Screen trade Friday was at 6,230 lots, NYBOT said. Open interest was at 204,192 lots as of June 29, up 4,092 lots from the previous session.—Reuters