* China GDP data reinforces worries about globaleconomy
* CRB index posts largest 1-day drop since Dec. 2011
* May cotton down 10 percent from 1-year high
NEW YORK, April 15 (Reuters) – ICE cotton futures posted their steepest daily loss in nearly a month on Monday, and many other commodities dropped sharply, as weaker-than-expected economic data out of China, the world’s top textile market, increased doubts about the globaleconomy.
The most-active July cotton contract on ICE Futures U.S. dropped 1.5 cents, or 1.7 percent, to settle at 86.12 cents per pound, posting its largest daily loss since March 20.
The Thomson Reuters-Jefferies CRB index registered its largest one-day decline since December 2011 as gold had its two-day drop since 1983, brent oil touched its lowest price since July, and grain prices fell. U.S. stocks extended declines.
Cotton sank amid the investor liquidation.
“There’s a lot of red on the screen, a lot of bleeding,” said Sharon Johnson, a cotton specialist with Knight Futures.
Speculators had held a large net long position in cotton futures and options, which they slashed in the week ended April 9, U.S. government data showed on Friday. As the noncommercial dealers cut their bullish bets, prices slumped more than 5 percent.
The spot May contract closed down 1.25 cents, or 1.5 percent, at 84.33 cents a lb, down about 10 percent from a 1-year high touched on March 15.
July cotton has fallen below its recent moving averages, sinking past technical support at those levels, dealers said.
The most-active contract also felt pressure from growing expectations that the upcoming U.S. crop may not be as small as initially forecast, Johnson noted.
“The wheat crop has been injured in the (Mississippi) delta and the southwest. That’ll be torn out and planted to something else, probably cotton,” she said.
Last month, the U.S. Agriculture Department pegged cotton plantings at the lowest in four years.
Expectations of a small upcoming crop in the United States underpinned a speculator-driven rally during the first quarter of 2013, when prices surged about 18 percent.
Exchange stocks continued their climb to the highest levels since June 2010, with ICE stocks totaling 456,559 bales on Friday, according to exchange data.
Active consumption from China also supported the first-quarter gains. Beijing has been building its reserves since 2011, paying above global prices to support local farmers. The country is expected to hold more than half of global inventories by the end of the crop year through July.
Prior to the recent rally, cotton posted two years of declines as lower-priced, synthetic alternatives eroded demand, and global stocks grew. (Reporting by Chris Prentice; Editing by Bob Burgdorfer)