Cotton Fibre Market Analysis: Trends, Prices, Insights & Forecast

Insights

• From the second and third weeks of May 2024, cotton prices in New York fell due to a USDA announcement predicting a rise in global production without a matching increase in usage, leading to expected surplus and price drop.
• In China, cotton prices plummeted due to weakened downstream demand, spinner caution in purchasing, growing cotton yarn inventory, and a notable decrease in U.S. cotton export sales to China.
• Prices in Pakistan declined with delayed cotton sowing, concerns over reduced acreage, lower urea sales affecting planting, and anticipation of potential consequences for yarn prices amid cash flow struggles.
• Cotton prices dropped due to slower-than-usual planting in Northern India, unchanged supply, and demand metrics according to the Cotton Association of India, and ample remaining supplies mainly in Maharashtra and Gujarat.
• The decrease in cotton prices in Brazil could be attributed to factors such as subdued sales activity domestically and in exports, alongside the impact of renewed volatility in New York futures, which affects price negotiations and buyer confidence.
• Additionally, the variation in yield projections between IMEA and CONAB may introduce uncertainty regarding supply levels, influencing market sentiment and prices.
• The average Cotlook Index declined to 0.856 per pound.
• Cotton prices are expected to remain weak In short run.