Through Friday, January 30, ICE cotton futures zigged and zagged across a lower-higher-lower pattern  (see chart above courtesy of Barchart.com). The March’26 contract closed Friday at 63.17 cents per pound, down 31 points on the day. The new crop Dec’26 also settled lower Friday at 68.75 cents per pound.  Chinese cotton prices were flat/mixed this week, as was the A-Index of world cotton prices.

Other ag futures markets tracked similar patterns across the week.  CBOT corn and soybeans both traded in a sideways gyration, while KC wheat trended lower, then higher and finally finished the week flat.  ICE WTI crude oil futures trended level, then higher before leveling off.  In contrast with these physical commodities, the U.S. Dollar Index traded flat, then down-shifted, and ended the week in a flat-to-higher pattern.  Other macro influences (i.e., GDP, inflation, and interest rate policy) remained mixed in their expectation and implication for slow economic growth.  Silver and gold futures prices peaked this week week after a major rally.

Cotton-focused news included unexciting U.S. export sales for the week ending January 22, down from the prior two weeks’ marketing year highs. Reported demand indicators included inactive to active spot trading, depending on the region, as well as light to moderate demand. The supply question is almost resolved for the 2025 crop.  As of January 15, NASS forecasted ginning of 94% of forecasted production being ginned. As of January 23, AMS also counted 96% of forecasted U.S. production being classed.

Through Thursday, January 29, cotton open interest increased daily across the week.  Some of this can be explained by continued speculative positioning, specifically week over week increases in long hedge fund positions (+3,188 contracts), outweighed by huge increases in short hedge fund positions (15,936 contracts).  The net long index fund position contracted by 6,544 contracts.

The dynamics of ICE cotton futures may also represent a wet blanket on the market.  It remains true that unfixed call sales (representing potential/eventual futures buying by mills) are at an historically low level, perhaps reflecting the cautionary buying on the demand side.

For more details and data on Old Crop and New Crop fundamentals, plus other near term influences, follow these links (or the drop-down menus above) to those sub-pages.