July 26 (Bloomberg) -- Cotton futures fell the most in two weeks on speculation that China, the world’s largest user, will produce more of the fiber than forecast.
China probably will harvest 7.22 million metric tons in the 12 months that start Aug. 1, more than the 7.05 million forecast in June, researcher Cotlook Ltd. said yesterday in a report. Global production will exceed demand by 2.14 million tons, or 5 percent more than forecast last month, Cotlook said.
"People weren’t expecting those numbers," Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said in a telephone interview. "We’re going to continue see increased supply and decreased demand."
Cotton for December delivery slumped 1 percent to 85.12 cents a pound at 2:30 p.m. on ICE Futures U.S. in New York, the biggest loss since July 11. Prices are up 13 percent this year on signs of reduced output in the U.S., the world’s largest exporter.
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