Nov. 3 (Bloomberg) --Cotton futures in New York and Zhengzhou advanced to records on lingering concerns that a production deficit in China, the world’s biggest buyer, may be wider than estimated, boosting the nation’s import needs. Cotton for December delivery on ICE Futures U.S. in New York climbed as much as 2 percent to $1.369 a pound, the highest price in 140 years of trading. Futures for May delivery on the Zhengzhou Commodity Exchange jumped as much as 3 percent to 29,620 yuan ($4,439) a metric ton, rising to an all-time high for a third straight day. “We continue to hear of reports of strong physical demand and concerns about the Chinese cotton crop,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, said by phone from Sydney today. “It’s a global phenomenon that we’re seeing at the moment, reflective of the fact that global cotton supplies are extraordinarily tight.” Global production is forecast to lag behind demand for a fifth straight year, draining stockpiles to the lowest level in 14 years, according to an Oct. 8 estimate by the U.S. Department of Agriculture. An 18.5 million-bale production deficit in China this year may push the nation’s inventories to a 16-year low, according to USDA data. The USDA estimates were released before a hailstorm hit Texas, the largest U.S. growing state, on Oct. 21. The China Meteorological Center said on Oct. 25 that a cold front moving across the nation might hamper cotton harvesting and reduce fiber quality, adding to global supply concerns. Market Stability “The textile market faces a shortage in raw materials,” the China Federation of Logistics and Purchasing said in a report e-mailed today. “Cotton and yarn prices rose sharply, affecting company profits and endangering company survival.” The China Cotton Association said yesterday the nation will boost management of the industry after prices surged. Major companies were urged to stabilize the market, the group said in a statement on its website, citing the National Development and Reform Commission. The USDA estimated on Oct. 8 that world use will exceed production by 890,000 tons in the year that began Aug. 1. That compares with the International Cotton Advisory Committee’s forecast on Nov. 1 that output will be 25.3 million tons in the year that began Aug. 1, exceeding demand by about 300,000 tons. The USDA will update its crop forecast for the U.S., the biggest exporter, on Nov. 9. To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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