ICE cotton prices decline amid weak demand & falling crude oil prices

Yesterday, the ICE cotton December contract settled at 71.37 cents per pound (0.453 kg), down by 107 points. The March 2025 contract was lower by 95 points, reaching 73.73 cents, according to trade analysts.

The decline in crude oil prices further dampened cotton market sentiment as it made the polyester value chain cheaper. Crude oil slipped over one per cent yesterday, marking the third consecutive day of decline. Slow economic growth in China raised fears of lower demand for crude oil. The dollar index settled with gains after retail sales data, discouraging foreign cotton buyers at higher prices.

ICE data indicated stable deliverable inventories of No. 2 cotton futures at 41,122 bales as of July 15. The CFTC data showed that speculators increased their net short positions in ICE cotton futures and options by 6,378 lots to 45,122 lots as of July 9.

As of Sunday, the US cotton crop’s good-to-excellent condition rate remained at 45 per cent, as per the USDA report. The high-quality rate of US cotton remains unchanged from the previous week at 45 per cent. However, many traders maintain a positive outlook on the cotton crop position. Traders are awaiting the US cotton export sales report due tomorrow to understand the current demand situation.

On Wednesday, ICE cotton for December 2024 traded at 72.07 cents per pound, up 0.70 cents. Cash cotton traded at 64.87 cents (down 0.49 cents), the October contract at 70.37 cents (down 0.49 cents), the March 2025 contract at 74.10 cents per pound (up 0.79 cents), the May 2025 contract at 75.43 cents (up 0.71 cents), and the July 2025 contract at 76.35 cents (up 0.60 cents). A few contracts remained at the level of the last closing, with no trading noted today.

Fibre2Fashion News Desk (KUL)