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ICE cotton edges up on weaker dollar, demand fears cap gains

04 Sep '25
2 min read
ICE cotton edges up on weaker dollar, demand fears cap gains
Pic: Shutterstock.com

Insights

  • ICE cotton futures closed higher yesterday, supported by a weaker US dollar that improved affordability for overseas buyers.
  • Gains were limited by persistent demand concerns, with tariffs weighing on sentiment and speculators maintaining heavy net-short positions.
  • Trading volume fell sharply, though open interest rose.
  • Market attention now turns to the USDA's weekly export sales report.
ICE cotton futures closed in positive territory yesterday, though gains were capped by persistent demand concerns. A weaker US dollar supported ICE cotton prices, making US cotton purchases more affordable for overseas buyers.

ICE’s most active December 2025 contract settled at 66.21 cents per pound (0.453 kg), up 0.16 cent. Other contracts closed 12–25 points higher yesterday.

Trading volume was 21,609 contracts, the fourth-lightest session this year, compared with 46,761 contracts in the prior session. Open interest rose by 5,252 contracts to 253,334, having declined in only seven sessions since the March 31, 2025 low of 200,437 contracts.

Market analysts noted that tariffs remain a negative for US cotton, with speculators maintaining heavy net-short positions.

Speculators increased net short positions by 2,305 contracts, reaching 60,493 contracts, according to CFTC data for the week ending August 26. Market focus now shifts to the USDA weekly export sales report due Friday to gauge demand.

Currently, ICE cotton for December 2025 was traded at 66.40 cents per pound (up 0.19 cent), cash cotton at 63.48 cents (up 0.16 cent), the October 2025 contract at 64.76 cents (up 0.03 cent), the March 2026 contract at 68.24 cents (up 0.18 cent), the May 2026 contract at 69.63 cents (up 0.17 cent) and the July 2026 contract at 70.54 cents (up 0.19 cent). A few contracts remained at their previous closing levels, with no trading recorded today.

ALCHEMPro News Desk (KUL)

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