Cotton Is Piling Up at Warehouses Around the World
- World stockpiles forecast at 2nd-largest ever at end of season
- U.S. output woes not enough to spur prolonged rally: Magnusen
A worker wades through cotton at a ginning mill in Pilibanga, Rajasthan, India, on Wednesday, Nov. 5, 2014.
Photographer: Prashanth Vishwanathan/BloombergThis article is for subscribers only.
There’s enough cotton sitting in global warehouses to make more than 127 billion T-shirts, or 17 for each person on the planet. That’s bad news for investors betting prices will rise.
World inventories at the end of this season will be the second-largest ever, just slightly less than last year’s record, according to a U.S Department of Agriculture forecast last week. That’s a signal that supplies will remain ample even after the agency cut its outlook for production. Hedge funds raised their bullish cotton bets to the highest in more than a year, only to face the first weekly price drop since early November.