Insights
- ICE cotton futures settled mixed in a narrow range, with US cotton belt weather, harvest-delay concerns, limited farmer selling and a softer dollar supporting prices.
- December 2026 cotton closed 9 points lower at 80.51 cents per pound, while open interest rose to a record 393,020 contracts.
- Weaker crude, subdued volumes and higher global supply expectations capped gains.
The most active December 2026 cotton contract settled 9 points lower at 80.51 cents per pound. Other contracts closed between 10 points lower and 6 points higher, reflecting limited price movement across the futures market.
Trading volume stood at 45,381 contracts, almost unchanged from Monday's 45,477 contracts. Although trading activity remained relatively subdued for a second consecutive session, market participation continued to strengthen. Open interest increased by 3,697 contracts on Monday to a record high of 393,020 contracts, surpassing the previous peak of 389,494 recorded on September 29. The increase suggested fresh positions were being established despite the narrow trading range.
According to the US Department of Agriculture's (USDA) latest Crop Progress report for the week ended October 11, cotton harvesting reached 31 per cent, compared with 23 per cent in the previous week and the five-year average of 29 per cent. Boll opening stood at 82 per cent, marginally below the five-year average of 83 per cent. Crop conditions improved slightly, with the proportion rated good increasing by one percentage point and the proportion rated poor declining by one percentage point.
- US cotton futures fall as harvest pressure weighs on ICE
- ICE cotton futures rise slightly but fail to sustain early gains
- India’s polyester, viscose yarn face persistent payment issue
- South Indian cotton yarn firms as higher fibre prices lift sentiment
- ICE cotton futures extend gains amid crop concerns
Market analysts said that persistent rainfall and adverse weather conditions across the US cotton belt, including the impact of storm Isaias, had raised concerns about crop damage and harvesting delays. Farmers remained reluctant to sell cotton at prevailing prices, providing additional support to the market and limiting losses in December futures.
The US dollar retreated from an 18-month high on Tuesday as investors assessed expectations of easing tensions in the Middle East ahead of the US mid-term elections and monitored the Federal Reserve's interest rate outlook. A weaker dollar generally makes US cotton more affordable for overseas buyers, potentially supporting export demand.
Meanwhile, Brent crude oil prices declined by 0.9 per cent on Tuesday after reaching nearly a one-month high in the previous session. Traders continued to monitor developments surrounding attacks on Saudi Arabia and Russia's diesel supply outlook. Lower crude oil prices can reduce polyester production costs, potentially improving the synthetic fibre's price competitiveness against cotton and exerting indirect pressure on cotton demand.
Market sentiment remained divided between supportive supply-side concerns and broader bearish influences. Adverse weather, potential harvest disruptions, limited farmer selling and a weaker dollar supported cotton futures. Conversely, softer crude oil prices, subdued trading activity and the USDA's upward revisions to global cotton production and stocks continued to weigh on sentiment.
The record open interest indicated growing positioning in the futures market, although it did not establish a clear price direction. December cotton continued to consolidate around 80.50 cents per pound, with traders monitoring harvesting progress, weather developments and movements in the dollar and crude oil markets.
For Indian textile mills, movements in ICE cotton futures and the US dollar remained important factors influencing cotton import economics and procurement decisions. The near-term outlook remained uncertain, with weather conditions and harvest progress likely to determine the next significant market movement.
This morning (Indian Standard Time), December 2026 cotton traded at 81.11 cents per pound (up 0.60 cent). Cash cotton traded at 78.26 cents (down 0.09 cent), while the March 2027 contract traded at 84.36 cents (up 0.53 cent). The May 2027 contract traded at 85.97 cents (up 0.49 cent), the July 2027 contract at 8,627 cents (up 0.35 cent), and the October 2027 contract at 79.90 cents (down 0.10 cent). A few contracts remained at their previous closing levels, with no trading recorded so far today.