Cotton futures fell for the second straight session as rising stockpiles in India and the highest prices in 15 years may encourage textile mills to slow the pace of buying. Orange juice gained.
Cotton stockpiles in India will be 15 percent higher for the season ending July 31, compared with a year earlier, the U.S. Department of Agriculture said Sept. 10. India, the second- biggest grower and exporter, halted shipments in April to bolster domestic supplies. Before today, prices surged 65 percent in the past year.
“We’ll have enough cotton in the pipeline hitting mills in October,” said Sharon Johnson, a senior analyst at First Capital Group LLC in Atlanta. Textile makers will be “more selective in terms of price,” she said.
Cotton for December delivery declined 1.04 cents, or 1 percent, to $1.002 a pound at 1:10 p.m. on ICE Futures U.S. in New York, after slipping to 99.29 cents, the lowest level this week. On Sept. 28, the fiber reached a 15-year high of $1.064 as U.S. inventories dwindled.
Yesterday, cotton tumbled 3.8 percent, the most in a year, on signs of higher production in India. The country will resume exports on Nov. 1.
“It’s looking increasingly like we have a top in place,” Johnson said. “Once you start taking the momentum out of the rally, it’s really tough to get that back.”
Yesterday, stockpiles held at warehouses monitored by ICE rose 5.3 percent, the most since March 3. They plummeted 98 percent in the past four months.
The International Cotton Advisory Committee will release its monthly forecast tomorrow for world production and demand.