* Fiber recovers Wednesday’s losses on trade buying
* Softer dollars supports cotton prices
* Cotton ends November little changed amid investor selloff
NEW YORK, Nov 29 (Reuters) - Cotton futures rose on Friday and recovered the previous session’s losses to end the month little changed, as trade buying counterbalanced an investor selloff and worries over global surpluses.
The most-active March cotton contract on ICE Futures U.S. edged up 0.91 cent, or 1.2 percent, to settle at 79.35 cents a lb.
Trading volumes on ICE were lighter than average following Thursday’s U.S. Thanksgiving holiday, with a delayed opening at 8 a.m. EST and early close of 1 p.m.
The Thomson Reuters/Core Commodity CRB index gained, and the U.S. dollar eased against a basket of currencies, lending support to dollar-traded commodities as it makes them less expensive to holders of other currencies.
Cotton ended the month with a slight gain, even as prices sank to 10-month lows, open interest fell to the lowest since January 2012 and investors switched to a net short position.
Strong U.S. weekly export sales in recent weeks have shown that lower prices reignited demand, though Friday’s data indicated the strong pace has begun to slow.
“(It) goes to show the only cure for low prices is low prices,” said Jobe Moss, a broker with MCM Inc. in Lubbock, Texas, describe Friday’s move as “a correction in a bear market.”
Prices sank over 2 percent on Wednesday on news that China, the world’s top producer and consumer, was to begin selling cotton from its mammoth state reserve.
Beijing sold about 12,000 tonnes on the first day of auctions, about half of what was on offer, according to an industry website. The sales will continue until Aug. 31 next year.
Trade sources said that the reserve bales will face stiff competition from Indian cotton, lower-priced and readily available as the No 2 producer harvests a bumper crop.
The announcement from Beijing lent more certainty to the global cotton market, as traders are hungry for updates on China’s plans for its massive strategic reserves.
Beijing’s controversial stockpiling program, launched in 2011, has driven voracious import demand and placed a floor under global prices.
Second-month prices have tumbled over 16 percent from an August peak near 94 cents a lb as investors fled bullish bets and speculation mounted that China would soon begin sales and potentially unload huge supplies on the market.
Some 226,000 bales of cotton have so far been tendered for cash delivery against the spot December contract, which closed up 1.39 cent, or 1.8 percent, at 78.14 cents a lb. (Reporting by Chris Prentice; Editing by James Dalgleish)