* Prices hit 9-month lows as harvest pressure, investor
* U.S. government data shows speculators reduce bullish
stance to Jan. levels
* Indian output forecast to reach historic levels
NEW YORK, Nov 1 Cotton futures closed down for
an 11th straight session on Friday as growing supplies have
driven investor selling, signaling the end of the
speculator-driven rally that lifted cotton to 94-cent highs
earlier this year.
The most-active December cotton contract on ICE Futures U.S.
edged down 0.6 cent, or 0.8 percent, to settle at 76.58
cents a lb.
The spot contract hit an intraday low of 76.54 cents
a lb, the weakest level since January, after posting an
11.5-percent loss in September.
New selling and the start of the index fund roll have added
weight to spot prices already under seasonal pressure as
Northern Hemisphere harvests pick up.
"The money that was moving into the sector is now moving
somewhere else," said Michael Smith of T&K Futures & Options, a
Port Saint Lucie, Florida-based brokerage.
Speculators reduced their bullish bets in cotton futures and
options to the lowest level since mid-January in the week ending
Oct. 22, U.S. government data showed on Friday.
With a 14-day RSI of 22, the spot contact is the most
oversold it has been since June 2012, according to exchange data
compiled by Reuters.
The December contract is down almost 18 percent from
its August high of 93.72 cents and second-month prices
are down in kind from March highs of 94.20 cents a lb.
Indian output is expected to reach a historic high this
season, though exports from the No 2 producer are forecast to
drop 13.5 percent due to slowing demand from top consumer China.
The U.S. crop is faring better than expected after
unfavorable weather earlier in the season and traders eyed a
possible higher production forecast from the U.S. Agriculture
Department in its monthly crop report next week.
It will be the first since the USDA canceled October's
report following a partial government shutdown.
Price support loans on 2013 crops are available again,
following a one-month hiatus to satisfy budget cuts, the agency
said on Friday.
Exchange stocks climbed to the highest levels since July on
Thursday, the most recent ICE data showed. At nearly 150,000
bales, they have surged from fewer than 12,000 bales a month
Falling prices have awakened demand for cotton, which
continues to face steep competition from lower-priced, synthetic
This week's U.S. government export data beat expectations.
(Reporting by Chris Prentice; Editing by Chizu Nomiyama)