Cotton Futures Showing Modest Recovery as Week Begins

Cotton entered the trading week with marginal uptick momentum, posting gains ranging from 10 to 18 points during the session. The rally built on Friday’s solid performance, when contracts advanced between 25 and 40 points, with March delivery demonstrating particularly strong movement of 74 points over the previous week.

Market Headwinds from Energy and Currency

Energy prices presented a headwind for commodities broadly. Crude oil futures declined $1.45 per barrel, settling at $56.90. Meanwhile, the US dollar index strengthened by $0.054, reaching $97.735—a factor that typically pressures commodity exports priced in dollars.

Contract-by-Contract Performance

The front-month contract tells the story of modest gains. Mar 26 Cotton settled at 64.49 cents, up 25 points with an additional 12-point advance in early trading. May 26 Cotton showed similar momentum, closing at 65.78 (up 29 points, currently ahead 15 points). Further out, Jul 26 Cotton reached 66.95, representing a 37-point gain with current strength of 18 points.

Supportive Price Signals

Several indicators supported the cotton complex. The Cotlook A Index rose 50 points on December 24, reaching 74.00 cents. The 12/24 online auction from The Seam revealed sales volume of 6,914 bales at an average price of 61.96 cents per pound.

ICE certified cotton stocks remained stable at 11,600 bales as of Wednesday. The Adjusted World Price held steady at 49.99 cents per pound, resuming reporting after the holiday period interruption prevented last week’s publication.

The confluence of supply data, index strength, and auction activity suggests market participants are digesting the early-week price action with measured optimism, though external pressures from energy weakness and dollar appreciation continue to weigh on sentiment.