Across the week ending Friday, October 10, ICE cotton futures descended to 7-month lows in a volatile session at week’s end (see chart above courtesy of Barchart.com). The daily settlements showed mostly losses other than Wednesday’s session. The Dec’25 settled Friday at 63.84 cents per pound, while Dec’26 settled at 67.93. Chinese cotton prices had no apparent pattern due to lack of trading, while the A-Index of world cotton price showed a mixed pattern.
Other futures markets followed various pathways this week CBOT corn and KC wheat futures both gyrated up and down before ending the week in an extended down trend. CBOT soybeans trended higher before switching to a down trend. ICE WTI crude oil futures started the week flat-to-higher before descending. The U.S. Dollar Index followed a steady up-trend across the week. Other macro influences (i.e., GDP, inflation, and interest rate policy) remained mixed in their expectation and implication for slow economic growth.
Cotton-focused market influences were hard to document in the absence of regular weekly data from USDA AMS and USDA FAS due to the federal shutdown.
Recent harvest weather influences included scattered rainfall over parts of the Delta and the Southeast. The onset of La Niña conditions could contribute to a drier fall. This could be neutral/beneficial to the maturing 2025 crop, at the cost of early dryness in early 2026. On the other side of the world, the precocious Indian monsoon is stronger/later than normal in what should be the withdrawal phase. It remains to be seen whether recent floods in India and especially Pakistan are a net benefit or detriment to summer-sown crops like cotton.
Through Thursday, October 9, the shifts in ICE cotton open interest were higher compared to the previous day. Combined with the mostly lower price settlements, this had the appearance of more short positioning. The federal shutdown prevented an update of the Tuesday (September 23) snapshot of speculative open interest. The latter reflected short positioning with 1,723 additional hedge fund shorts, week over week, reinforced by 1,582 fewer (liquidated) hedge fund longs and a 2,808 position contraction of the index trader net long position.
The dynamics of ICE cotton futures may also represent a wet blanket on the market. It remains true that unfixed call sales (by mills) are at an historically low level, perhaps reflecting the cautionary buying on the demand side. In terms of ratios, unfixed call purchases (by suppliers) outweigh unfixed call sales by over two-fold across all contracts, as of September 19 (not updated due to the federal shutdown). For the Dec’25 contract alone, there were over three unfixed call purchases for every unfixed call sale.
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.
Πηγή: TAMU