ICE cotton weakens on farmers’ selling, but decline capped

ICE cotton futures remained bearish as farmer selling and algorithmic activity dampened market sentiment. The overall commodities market was weak yesterday, although a falling US dollar and rising crude oil prices helped limit the decline in US cotton.

The more active March 2026 cotton futures settled at 64.46 cents per pound, down 0.11 cents, reflecting continued price stagnation. Other contracts closed with declines between 4 and 11 points. The 64-cent low attracted some fundamental buying interest, but farmer selling and algorithmic trades capped any move toward 65 cents.

ICE cotton futures remained weak as farmer selling and algorithmic activity limited any upward move despite support from a softer US dollar and firmer crude oil.
March 2026 settled at 64.46 cents amid low trading volumes and stagnant prices.
Weak US economic data boosted expectations of rate cuts.
JP Morgan sees prices potentially rising to 75 cents by late next year.

The US Dollar Index fell 0.45 per cent to 98.85, touching an intraday low of 98.82, its lowest level since October 29. The weaker dollar made US cotton cheaper for global buyers and supported overall demand.

Rising crude oil prices increased polyester costs, indirectly supporting cotton prices as polyester became less competitive.

Total trading volume was 26,902 contracts, one of the lowest levels in more than two months.

Overall commodities were weaker, while US equity markets moved towards all-time highs. Market sentiment was driven by expectations of a possible December interest rate cut by the Federal Reserve. US ADP data showed private-sector employment fell by 32,000 in November compared to expectations of a 10,000-job increase. Weaker-than-expected economic data strengthened expectations of further monetary easing.

CFTC data showed speculators reduced net short positions by 2,480 contracts, taking their total net short position to 84,607 contracts for the week ending October 21.

JP Morgan projected that ICE cotton futures could rise toward 75 cents per pound by the fourth quarter of next year, while ICE-certified stock remained stable at 19,894 bales as of December 2.

This morning (Indian Standard Time), ICE cotton for March 2026 traded at 64.44 cents per pound (down 0.02 cent), cash cotton at 62.46 cents (down 0.11 cent), the December 2025 contract at 62.66 cents (down 0.11 cent), the May 2026 contract at 65.57 cents (down 0.03 cent), the July 2026 contract at 66.54 cents (down 0.06 cent), and the October 2026 contract at 67.40 cents (down 0.08 cent). A few contracts were unchanged from the previous close, with no trading recorded so far today.

Fibre2Fashion News Desk (KUL)