Chinese analysts expect the country's cotton output in 2011/12 crop year to be 7.4 million tonnes, 17.8 percent higher than their estimate for 2010/11, according to a survey of six analysts contacted by Reuters on Friday.
The median forecast is an increase of 1.12 million tonnes from the 2010/11 median estimate of 6.28 million tonnes by the same analysts, and higher than the US Department of Agriculture's August forecast of 7.19 million tonnes. China's official cotton output estimate for 2010/11 provided by the statistics bureau was 5.96 million tonnes.
Cotton prices have been falling since the start of this year, partly reflecting a forecast for higher output in 2011. However, analysts do not expect prices to fall far below 20,000 yuan a tonne due to the government's supporting purchase mechanism, which sets cotton buying prices at 19,800 yuan per tonne and which does not cap the volume.
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