Cotton Market Summary as of Friday, March 24, 2023

For the week ending Friday, March 24, ICE cotton futures traded sideways-to-slightly-higher before reversing and sliding towards the mid-70s gap from early November (see chart above courtesy of The most active May’23 contract settled Friday down 104 points at at 76.54 cents per pound, while the new crop Dec’23 settled at 78.40 cents.  The week saw somewhat divergent patterns for CBOT corn, CBOT soybeans, and KC wheat, although these and other financial markets, including the U.S. dollar index, all reflected mid-week pressure following a widely expected hike in U.S. interest rates plus some less expected banking sector impactsChinese cotton prices were flat-to-higher across the week, while the weekly pattern of the A-Index of world prices was more flat.

Cotton-specific influences this week included strong U.S. export sales with actual export shipments remaining at the target weekly average level.   USDA’s weekly summary of the U.S. regional markets continued to reflect spot physical trading from inactive (Delta, Western markets), to slow (Southeast, Western Pima), to active (Texas markets), along with mostly light to very light demand reported.

The pattern of ICE cotton futures open interest gradually increased across the week.  The regular Tuesday snapshot of speculative positioning (through March 21) showed a mix of adjustments including 8,692 additional hedge fund shorts, week over week, compared to 3,129 additional index fund longs.

For more details and data on Old Crop and New Crop fundamentals, plus other near term influences, follow these links (or the drop-down menus above) to those sub-pages.

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