Cotton Bounces Back Strong on Monday—Here's What Traders Should Know

BlockchainArchaeologist · 2026-01-12T18:50:50+00:00

Cotton markets show significant gains in early trading, reversing last week's declines. March, May, and July futures all rebound, driven by demand insights and supply stability. Market dynamics suggest traders are positioning for spring planting and potential weather issues.

BlockchainArchaeologist

2026-01-12 18:50:50

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Cotton markets are showing notable strength as Monday trading gets underway, with gains ranging from 35 to 46 points in the morning session. This reverses Friday’s bearish pressure, when contracts ended the week with declines of 11 to 26 points. March futures took the heaviest hit, losing 48 points across the compressed trading week.

The broader commodity landscape painted a mixed picture heading into this week. Crude oil futures retreated 9 cents to settle at $57.41 per barrel, while the US dollar index climbed $0.123 to $98.170—movements that typically influence cotton’s export competitiveness.

Market Supply and Pricing Signals

Year-end auction activity provided insight into cotton’s underlying demand. The Seam conducted an online auction on December 31, moving 17,479 bales at an average price of 65.40 cents per pound—a data point worth tracking for supply dynamics.

Physical cotton stocks tell a steady story. ICE certified inventory remained firm at 11,510 bales as of December 31, showing no meaningful drawdown pressure. The Cotlook A Index held its ground, closing unchanged at 74.30 cents on Wednesday. Meanwhile, the Adjusted World Price captured upward momentum, reaching 50.76 cents per pound on Friday morning—a 74-point jump from the previous week. The LDP rate now stands at 1.24 cents.

Contract Performance Today

Three key futures contracts are leading the rebound:

March 26 Cotton: Closed Friday at 64.01, down 26 points, but has climbed 40 points in early Monday action.

May 26 Cotton: Finished last week at 65.37, off 23 points, now up 43 points to start the new trading week.

July 26 Cotton: Ended Friday at 66.72, declining 11 points, currently gaining 46 points—the strongest performer of the three.

The back-month strength suggests traders are building positions ahead of spring planting concerns and potential weather-related disruptions. With the July contract posting the largest gains, medium-term fundamentals appear to be attracting fresh buying interest.

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice.

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