For week ended May 12, about 30,500 bales of U.S. cotton to be delivered by July 31 were cancelled, according to information from the U.S. Agriculture Department. Since March 7, when the soft fiber notched record prices of $2.197 per pound, cotton prices have slumped 29 percent. Analysts correlated those issues with slackening demand from the top consumer of cotton, which is China.
"There are demand problems," Jack Scoville, a vice president at Price Futures Group Inc. in Chicago. "We can't have canceled sales all the time and see any kind of tight demand that would drive prices higher."
On Thursday, cotton futures closed down 2.63 percent, a 0.0421 cent drop to $1.5565 per pound.
Flooding in regions surrounding the Mississippi River and droughts in China and Texas helped push up cotton prices 11 percent during the past four sessions as concerns about supplies bandied about.
China also canceled 44,000 bales of cotton for week ended May 12.
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