* USDA export data robust, but impact muted
NEW YORK, March 15 (Reuters) – Cotton futures ended higher Thursday due to investor demand and stronger outside markets, but lingering fears about the economic outlook kept the advance on a tight leash, analysts said.
The benchmark May contract on ICE Futures U.S. rose 0.20 cent to finish at 87.34 cents per lb, dealing from 87.07 to 88.26 cents. It was an inside day within Wednesday’s 87.05 to 88.59 cents band.
Volume traded Thursday came to over 16,500 lots, almost a third under the 30-day norm, Thomson Reuters data showed.
Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia, said there are fears in the cotton trade that slowing economies in Europe would further adversely impact cotton demand since the EU is the top textile customer of China, the world’s leading cotton consumer for its textile mills.
“Cotton’s got ankle weights on,” he said.
The cotton market could not post further advances despite the strong performance of global markets and the weekly U.S. Agriculture Department’s weekly export sales data.
USDA said net upland cotton sales hit 239,900 running bales (RBs, 500-lbs each) while shipments stood at 365,600 RBs.
Traders said the world cotton supply balance is also bearish and would serve to cap the market.
USDA recently increased its world 2011/12 cotton production forecast to 123.64 million 480-lb bales from 123.34 million, and cut its projection of world consumption to 108.72 million bales from 109.71 million.
It upped its forecast of world end-of-season stocks to 62.32 million from 60.77 million bales. The 2011/12 marketing year ends on July 31.
Technically, the May contract held above the March 12 intraday low at 87.01 cents, an area which has held since late December 2011.
The fiber trade is also waiting for news from India, which is prohibiting fresh cotton exports after a week of policy disputes.
India is the world’s No. 2 cotton producer and the biggest exporter after the United States.
In two weeks, the market will be looking at the USDA’s annual potential plantings report, which will set the table for U.S. cotton sowings in 2012.
(Reporting by Rene Pastor)