Cotton prices surge

Cotton prices hit a new high on Wednesday, reaching US$2,494 per ton after a 1.12% increase on the Zhengzhou Commodity Exchange, reported state media. Contract prices on cotton have risen more than 7% in the past fortnight on the back of a supply deficit, exacerbated by shrinking inventories and heavy snowfall in the Xinjiang autonomous region, which will reduce this year’s output. Farmers are also shifting away into crops with more profitable margins. China is expected to issue around 800,000 tons in import quotas to close the gap between demand and supply, while the USDA anticipates China will import 2.18 million tons of cotton this year.