ICE cotton firms as weaker US dollar & speculative buying lend support

The most active March 2026 cotton futures contract settled at 63.94 cents per pound, up 0.11 cents. The contract had fallen by 14 points on Friday. Other contracts gained between 10 and 16 points.

The US Dollar Index fell around 0.2 per cent, hovering near a three-month low, which improved the competitiveness of US cotton for overseas buyers.

Total trading volume stood at 28,223 contracts, down from 30,527 cleared on Friday. Average daily volume last week was 34,279 contracts, indicating relatively lighter participation.

Market participants said cotton appears to have formed a short-term low last week and is currently trading within a defined range.

Market analysts noted that speculative buying emerged after last week’s lows, adding that a stronger stock market and a weaker dollar could continue to support prices. US equities rebounded, although sentiment remained cautious amid concerns over AI-related investments and upcoming macroeconomic data gaps.

CFTC data for the week ended November 18 showed speculators reduced net short positions by 4,183 contracts to 71,478 contracts. The reduction in net shorts signals easing bearish bets and a shift towards cautious optimism in market sentiment.

USDA weekly export sales for the week ended November 20 totalled 157,700 bales (154,600 upland and 3,100 Pima), including 3,100 bales for the 2026–27 season. Shipments reached 127,500 bales, comprising 120,800 bales of upland and 6,700 bales of Pima cotton.

In the broader agricultural complex, CBOT soybean futures hit a seven-week low as traders unwound positions amid concerns over the pace of US exports. Expectations of a bumper soybean harvest in Brazil and broad agricultural market selling weighed on sentiment. Grains remained weak overall, while metals showed strength, reflecting mixed cross-commodity signals.

This morning (Indian Standard Time), ICE cotton for March 2026 was trading at 63.90 cents per pound (down 0.04 cent), cash cotton at 61.69 cents (up 0.11 cent), the May 2026 contract at 65.04 cents (down 0.02 cent), the July 2026 contract at 66.11 cents (up 0.01 cent), the October 2026 contract at 66.65 cents (up 0.10 cent) and the December 2026 contract at 67.70 cents (up 0.01 cent). A few contracts remained at their previous closing levels, with no trading recorded so far today.

ALCHEMPro News Desk (KUL)