ICE cotton slips on weak sales, crude oil and harvest pressure

ICE’s most active December 2025 contract settled at 66.03 cents per pound (0.453 kg), down 0.17 cent, losing 51 points during the week. Other contracts closed lower by 9–30 points, with weekly declines of 16–82 points. However, the December 2027 and July 2028 contracts gained 32–51 points. The December 2025 contract remained in a range near the more than three-week high reached on Tuesday.

Crude oil prices weakened sharply as disappointing US employment data raised concerns about energy demand. Market sentiment was further dampened by expectations that OPEC+ may announce a production increase at its weekend meeting, heightening oversupply risks. Weaker crude oil indirectly pressured cotton due to its link with polyester and synthetic fibre demand.

Trading volume stood at 21,077 contracts compared to 22,926 in the previous session. Average daily volume this week was 28,093 contracts, while the last three sessions averaged 21,871 contracts. Weekly activity showed lighter participation toward the end of the week despite the USDA sales report. Open interest rose by 1,000 contracts to 256,983.

As of September 4, ICE deliverable stocks for the No. 2 cotton futures contract were unchanged at 15,474 bales, indicating stable certified stocks. This marks the 39th increase in the past 46 sessions, showing a steady build-up in market positioning.

Speculative traders (managed money funds) were net sellers and now hold their largest outright short and net short positions since early April. Commercial trade accounts turned net long during the week, mainly due to fresh long buying rather than short covering, suggesting that trade hedgers find current price levels attractive.

USDA weekly export sales of Upland and Pima cotton for the week ending August 28 totalled 246,600 bales, all for the 2025–26 season. Cumulative export commitments for 2025–26 now stand at 3,756,800 bales. Total shipments so far this season are 568,100 bales, reflecting a modest start compared with prior years.

Market analysts said sales were strong at 245,000 bales, and with cotton prices at relatively cheap levels, more buying could be expected. However, they cautioned that new demand has yet to emerge significantly. As soon as bolls mature, harvest will begin, and short-term supply will rise, keeping pressure on prices.

Overall, cotton futures ended lower for the second consecutive week, with weak demand signals and harvest pressure outweighing otherwise supportive export sales data.

ICE cotton for December 2025 settled at 66.03 cents per pound (down 0.17 cent), cash cotton at 63.14 cents (down 0.30 cent), the October 2025 contract at 64.39 cents (down 0.30 cent), the March 2026 contract at 67.96 cents (down 0.13 cent), the May 2026 contract at 69.34 cents (down 0.14 cent), and the July 2026 contract at 70.23 cents (down 0.14 cent).

ALCHEMPro News Desk (KUL)