Cotton climbs in US, China on supply concern

Cotton advanced for a fifth day in New York to trade near a record, while prices in Zhengzhou advanced for a fourth day to near an all-time high on concern that global demand led by China will outstrip supplies. Cotton for December delivery rose as much as 1.2 per cent to $1.372 a pound on ICE Futures US and traded at $1.3681 at 1:55 pm Tokyo time. The price reached $1.392 yesterday, the highest level since the fiber started trading 140 years ago.

Cotton has surged 81 per cent this year, the best-performing commodity on the Thomson Reuters/Jefferies CRB Index. Prices are rallying on concern that a production deficit in China may be wider than estimated, forcing mills to import more from global stockpiles that already are forecast to drop to a 14-year low. The US is the world’s biggest exporter, while China is the biggest consumer. Futures for May delivery on the Zhengzhou Commodity Exchange gained as much as 0.9 per cent from the previous settlement to 29,920 yuan ($4,481) a metric ton. They traded at 29,760 yuan at the 11:30 am local-time break. The contract reached a record 29,980 yuan yesterday.