ICE cotton slips as cheaper crude, weak commodities weigh

The most active March 2026 cotton futures settled at 64.32 cents per pound, down 0.03 cent. The contract has lost 17 points over the past two days and struggled to sustain levels above 64 cents. The March contract traded within a 60-point range, between 64.20 and 64.80 cents.

Cotton prices are expected to decline nearly 6 per cent in 2025, marking the fourth consecutive year of annual losses, driven by ample global supply and unstable demand linked to trade tensions.

Daily trading volume totalled 37,264 contracts, virtually unchanged from the previous session’s 37,122, indicating limited fresh participation. Open interest fell by 1,355 contracts to 177,836, signalling ongoing liquidation rather than new short build-up.

ICE-certified stocks remained unchanged at 11,600 bales, with zero bales awaiting review, keeping deliverable supply stable. Options volume reached 3,933 contracts, with 2,250 puts versus 1,683 calls, reflecting defensive positioning.

Market analysts said cotton initially benefitted from stronger external markets but reversed course as commodities weakened later in the session.

A weaker dollar in recent weeks and improved demand over the past three weeks have provided underlying support despite the pullback.

Crude oil prices were mostly steady amid geopolitical tensions around Russia-Ukraine and Yemen, but lower oil prices continue to keep polyester cheaper. Meanwhile, wheat, corn, soybeans and US equities all closed weaker, adding further pressure to cotton.

This morning (Indian Standard Time), ICE cotton for March 2026 was trading at 64.24 cents per pound (down 0.08 cent), cash cotton at 62.07 cents (down 0.03 cent), the May 2026 contract at 65.56 cents (down 0.08 cent), the July 2026 contract at 66.76 cents (down 0.09 cent), the October 2026 contract at 67.59 cents (up 0.12 cent) and the December 2026 contract at 68.24 cents (down 0.08 cent). A few contracts remained at their previous closing levels, with no trading recorded so far today.

ALCHEMPro News Desk (KUL)