China is hoarding a record amount of cotton to aid farmers as global production exceeds demand for a fourth consecutive year, increasing the risk of a supply surge that would tip prices into a bear market.
Cotton futures tumbled to a 31-month low on signs that a slowing world economy will expand a surplus of the fiber, reducing costs for clothing retailers including J. Crew Group Inc. and American Eagle Outfitters Inc.
Cotton prices are being driven by “strong demand and fundamentals,” rather than speculators, said Terry Townsend, the executive director of the International Cotton Advisory Committee. Following are comments Townsend made at a United Nations commodity conference in Geneva today: