Cotton Futures Dip on Thursday; Weekly Quotes Signal Mixed Market Sentiment

Midweek trading sessions brought pressure to cotton futures across multiple contract months during Thursday’s market action. Spot quotes revealed significant losses throughout the morning, with front-month contracts experiencing 10 to 32 point declines as market participants reassessed their positions.

Morning Trading Summary: Cotton Futures Post Losses

The futures markets opened with bearish momentum Thursday, presenting challenging conditions for cotton traders. March 26 contracts fell 32 points to settle at 63.41, while May 26 declined 15 points to 65.31 and July 26 dropped 13 points to 66.97. These moves reflected broader market concerns about supply dynamics and demand fundamentals affecting the commodity complex.

Concurrent with cotton weakness, crude oil futures gained ground with a $2.10 per barrel advance to reach $65.33, while the US dollar index retreated $0.139 to 96.135 after the previous session’s sharp decline. The divergent directional moves underscored the complex interplay between energy markets and currency valuations.

Export and Shipment Data Reveal Market Dynamics

Weekly export statistics provided insight into the actual pace of cotton movement into international channels. The most recent export sales report documented 203,666 RB of cotton sold during the week ending January 22, representing the weakest three-week performance and suggesting moderating buyer interest at current price levels. However, corresponding shipment data told a different story, with weekly volumes reaching 257,036 RB—the highest figure since May—indicating accelerating physical deliveries despite futures market weakness.

Census-derived trade information painted a broader picture of November activity, showing cotton exports (excluding linters) totaled 539,059 bales, marking a four-year low and signaling subdued export demand relative to historical patterns.

Price Indices and Inventory Update

The Cotlook A Index recovered ground with an 85-point advance on January 27 to reach 74.15 cents, offering some respite to sellers amid the broader downtrend. The Adjusted World Price benchmark was updated to 50.99 cents per pound, down 18 points from the prior week’s level.

Wednesday’s online auction from The Seam executed sales at 59.34 cents per pound across 9,834 bales, providing reference quotes for participants evaluating current market value. ICE certified cotton stocks registered a minimal 3-bale increase as of January 28, with the total certified inventory position standing at 8,600 bales—reflecting tight available supply for delivery obligations.

Market participants monitoring these Thursday quotes and weekly data points should consider the interplay between export weakness, strong shipment activity, and modest inventory levels when positioning for the upcoming session.