Nov. 17 (Bloomberg) -- Cotton fell the most in more than eight weeks on concern that EuropeΆs debt crisis will slow global growth and trim commodity demand.

The Standard & PoorΆs GSCI Index of 24 raw materials fell as much as 3.2 percent as European borrowing costs surged amid mounting concern the regionΆs leaders will fail to stem fiscal woes. World cotton demand will be 1.7 percent lower than forecast last month, leaving a “massive” surplus of more than 3.5 million metric tons, according to Cotlook Ltd., a research company in Birkenhead, England.

“The worldΆs going to have enough cotton to meet its demands,” John Flanagan, the president of Flanagan Trading Corp. in Fuquay-Varina, North Carolina, said in a telephone interview. “Demand is slow because of the economic situation in the U.S. and Europe.”

Cotton for March delivery declined by the exchangeΆs 4-cent limit, or 4 percent, to settle at 96.48 cents a pound at 2:46 p.m. on ICE Futures U.S. in New York, marking the biggest loss since Sept. 19.

The fiber has tumbled 56 percent from a record $2.197 on March 7. A bale weighs 480 pounds (218 kilograms)

“The commercial sector is still ailing, as evidenced by the complete lack of demand outside of China,” Andy Ryan, a senior-risk management consultant at INTL FCStone Inc. in Nashville, Tennessee, said in a report.