Through Friday, March 20, the most active ICE May cotton futures contract rose, leveled off, and finally weakened slightly (see chart above courtesy of Barchart.com). Chinese cotton prices mostly weakened across the week, while the A-Index of world cotton prices mostly strengthened.
Other ag futures markets tracked a similar pattern to each other this week. CBOT corn and soybeans, along with KC wheat futures, all trended lower early in the week, leveling out in a sideways patter before eventually recovering. ICE WTI crude oil futures gyrated sideways between the mid 90s to over $100 per barrel. The U.S. Dollar Index glided lower. Other macro influences (i.e., GDP, inflation, and interest rate policy) remained mixed in their expectation and implication for slow economic growth.
Cotton-focused news this week included continued unspectacular U.S. export sales. In addition, U.S. export shipments through March 12 dipped lower from the previous week’s marketing year high. Reported demand indicators included inactive to active spot trading as well as light demand and light to moderate supplies, depending on the region. The supply question is likely resolved for the 2025 crop. As of March 1, NASS forecasted ginning of 99.5% of forecasted production as being ginned. Also, as of March 12, USDA AMS counted 99% of forecasted U.S. production as having been classed.
Through Thursday, March 12, the daily shifts in ICE cotton open interest were mixed-to-flat. For the week ending Tuesday March 10, there was net long positioning in the form of over 8,269 hedge fund longs, reinforced by 1,524 fewer hedge fund shorts, and only partially countered by a 5,049 shrinkage of the index fund net long positions).
The dynamics of ICE cotton futures may also represent a wet blanket on the market. First, the rising certified stock levels in early 2026 could have been reflecting weak commercial demand for U.S. cotton. However, the certified stock level appears to have peaked, so the demand implications are less clear. Second, it remains true that unfixed call sales (representing potential/eventual futures buying by mills) are at an historically low level, perhaps reflecting the cautionary buying on the demand side. Having said that, unfixed call sales continue to rise in March from their prior lower levels.
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