ICE cotton edges higher as short covering lifts prices

The most active March 2026 cotton futures settled at 63.51 cents per pound, up 0.08 cent. ICE cotton contracts through June 2026 were narrowly mixed but generally firmer, edging higher by 1 to 8 points. The March 2026 contract posted its third higher close this week, although it still recorded a net weekly loss of 32 points.

Trading activity slowed sharply, with only 22,468 contracts traded, the lowest daily volume since September 15. This compared with 35,790 contracts cleared in the previous session, highlighting fading participation and limited market conviction.

Broader markets remained cautious amid lingering CPI-related macro uncertainty, adding to cotton’s tug-of-war price action.

Market analysts said the gains were mainly due to traders covering short positions, which requires buying back contracts and thereby adds buying interest to the market.

CFTC data released on Wednesday showed that in the week ending December 2, speculators reduced net short positions by 4,595 contracts to 61,486, signalling easing bearish bets. This reduction reflected cautious optimism or mildly improved sentiment rather than a clear bullish shift.

USDA reported net US cotton export sales of 140,400 bales for the week ending November 27. Current marketing year sales were 135,900 bales, down 8 per cent week on week and 23 per cent below the four-week average, while next marketing year sales totalled 4,500 bales.

This morning (Indian Standard Time), ICE cotton for March 2026 was trading at 63.71 cents per pound (up 0.20 cent), cash cotton at 61.26 cents (up 0.08 cent), the May 2026 contract at 64.78 cents (up 0.17 cent), the July 2026 contract at 65.80 cents (up 0.14 cent), the October 2026 contract at 66.06 cents (up 0.01 cent), and the December 2026 contract at 67.31 cents (up 0.16 cent). A few contracts remained at their previous closing levels, with no trading recorded so far today.

ALCHEMPro News Desk (KUL)