Cotton Futures Experience Declines Amid Market Shifts
On Friday, cotton futures experienced a decline, with losses ranging from 115 to 144 points in the nearer contracts. Specifically, the May contract fell by 354 points throughout the week, indicating a challenging period for the cotton market. Additionally, crude oil futures saw a significant decrease, plunging by $4.63 per barrel as the US dollar index rose by $0.821 on the same day.
In the global trade arena, China reacted to President Trump’s reciprocal tariffs by imposing a retaliatory tariff of 34% on all imports from the United States. In contrast, Vietnam adopted a more favorable stance by offering to reduce its tariffs to 0%, a move that provided some support to the cotton market, particularly during sessions when prices were hitting lows.
As for the latest data from the Commodity Futures Trading Commission (CFTC), the Commitment of Traders report released on April 1 revealed that managed money participants reduced their net short positions in cotton futures and options by 7,176 contracts. By Tuesday, they were holding a net short of 66,634 contracts, reflecting a cautious approach from traders amid the shifting market dynamics.
The export sales figures indicate that total cotton commitments stand at 10.438 million running bales (RB), representing a 4% decrease compared to the previous year. This number accounts for 101% of the USDA’s projections, matching the average pace of 102% recorded in prior reports.
The Cotlook A Index, a key indicator for cotton pricing, dropped by 50 points to 79.60 cents per pound as of April 3. On April 2, the certified stocks of ICE cotton remained unchanged, with the current total at 14,488 bales. In a related development, the USDA’s Adjusted World Price (AWP) saw an increase of 158 points on Thursday, raising it to 55.22 cents per pound.
For the day’s closing figures on cotton futures, May 2025 contracts ended at 63.36 cents, down by 144 points. Similarly, the July 2025 contract closed at 64.56 cents, reflecting a loss of 115 points, while the December 2025 contract settled at 66.16 cents, down 139 points.
This information highlights the ongoing volatility in the cotton market, influenced by both domestic policies and international trade relations. Traders and stakeholders are closely monitoring these developments as they navigate the current economic landscape.
