ICE cotton hits 3-week low on strong dollar, good weather

ICE’s most active December 2025 contract settled at 66.05 cents per pound (0.453 kg), down 0.49 cent, after touching a low of 65.80 cents—the weakest level since August 8. Other contracts closed lower by 22–55 points yesterday.

A stronger US Dollar Index made cotton less affordable for overseas buyers, adding pressure on prices.

Trading volume rose to 46,761 contracts, the highest in 13 sessions, compared with 34,268 contracts in the previous session and a 32,646-contract daily average last week. Open interest has been climbing since the 2025 low of 200,437 contracts on March 31. Current open interest stood at 248,082 contracts, up 3,218 from Friday.

CFTC data for the week ending August 26 showed speculators increased net short positions by 2,305 contracts, bringing the total to 60,493. ICE deliverable stocks remained unchanged at 15,474 packages.

Sales were active but largely in non-US growths, as tariffs discouraged US cotton purchases. Tariff impacts also raised domestic costs for US consumers, further weighing on demand.

Rainfall in Texas boosted expectations of above-average West Texas yields, with production estimates raised by 250,000–500,000 bales.

CBOT wheat prices declined on a bumper northern hemisphere harvest and strong Australian crop outlook. US equities had a subdued start to September as investors assessed tariff policy uncertainty. A US federal appeals court ruling that most tariffs were illegal also influenced market sentiment.

India is expected to buy record cotton volumes from farmers in the new season as cheap imports and high US tariffs reduce textile export demand, putting pressure on domestic prices.

As of now, ICE cotton for December 2025 was trading at 65.91 cents per pound (down 0.14 cent), cash cotton at 63.32 cents (down 0.64 cent), the October 2025 contract at 64.88 cents (up 0.31 cent), the March 2026 contract at 67.79 cents (down 0.12 cent), the May 2026 contract at 69.22 cents (down 0.10 cent) and the July 2026 contract at 70.19 cents (down 0.04 cent). A few contracts remained at their previous closing levels, with no trades recorded today.

ALCHEMPro News Desk (KUL)