ICE cotton rises as demand optimism outweighs strong US dollar

ICE cotton futures closed higher on expectations of increased demand for the natural fibre. The optimism outweighed pressure from a stronger US dollar and stable crude oil prices. The market continues to struggle with demand outlook uncertainty amid the ongoing US government shutdown, which has delayed key official reports.

ICE December cotton futures settled at 65.68 cents per pound, up 0.14 cents. The March 2026 contract gained 0.15 cents to close at 66.88 cents per pound, while the May 2026 contract firmed by 0.12 cents to reach 68.02 cents.

International crude oil futures held steady, with US WTI crude up 0.04 to settle at $61.02 per barrel. The oil market balanced the latest OPEC+ supply increase against its proposed halt to production cuts in the first quarter of 2026. However, concerns persisted over a potential oil surplus and weak Asian manufacturing data. Lower oil prices make polyester—a cotton substitute—relatively more affordable, thereby reducing demand for cotton.

The US dollar hovered near a three-month high on Monday, making cotton more expensive for overseas buyers holding other currencies. The US Dollar Index rose 0.077 points to 99.707, while the Indian rupee weakened slightly by 0.01 to close at 88.78 per dollar.

According to data released by ICE, as of October 31, the inventory of deliverable No. 2 cotton futures contracts remained unchanged at 13,749 bales.

Market analysts said the market was expecting more purchases of US cotton. The US cotton harvest is nearing completion, reducing hedging pressure on prices.

Investors continued to seek updates on cotton export activity, as the ongoing US government shutdown has led to the suspension of key USDA reports, including the monthly World Agricultural Supply and Demand Estimates (WASDE) and weekly export sales data.

The latest data from the International Cotton Advisory Committee (ICAC) showed that global cotton production for 2025–26 is estimated at 25,399,600 tons, down from 25,438,600 tons last month. Global production for 2024–25 is estimated at 25,391,200 tons. Global cotton ending stocks for 2025–26 are projected at 16,227,900 tons, up from 15,378,700 tons last month, representing a 2.5 per cent year-on-year increase. Ending stocks for 2024–25 are estimated at 15,835,800 tons.

Overall, the ICE cotton market remained supported by expectations of improved demand, even as traders closely monitored dollar movements, crude oil trends, and delayed US export data.

As of this morning (Indian Standard Time–IST), ICE December 2025 cotton was trading at 65.62 cents per pound (down 0.06 cent), cash cotton at 63.18 cents (up 0.14 cent), the March 2026 contract at 66.84 cents (down 0.04 cent), the May 2026 contract at 68.01 cents (down 0.01 cent), the July 2026 contract at 69.10 cents (down 0.03 cent), and the October 2026 contract at 68.98 cents (up 0.15 cent). A few contracts remained unchanged, with no trading recorded so far today.