ICE cotton futures rose to a one-week high on Monday, supported by a weaker US dollar and light short covering, even as overall trading volumes remained subdued. A softer dollar makes cotton more attractive to overseas buyers, helping prices recover after a muted week.
The July 2025 contract settled higher at 68.
42 cents per pound, while the December contract gained 0.
27 cent to reach 69.98 cents per pound. Analysts noted that the rebound was primarily driven by currency shifts and speculative adjustments, rather than a surge in physical demand.
However, falling crude oil prices capped further gains. Lower oil prices reduce production costs for polyester, a key substitute for cotton, often weighing on the fibre’s price outlook. Market participants highlighted that this competition between natural and synthetic fibres remains a persistent factor influencing cotton’s trajectory.
On the supply side, planting progress in the United States has been ahead of schedule, with about 21 percent of the cotton crop already planted, surpassing the five-year average. This stronger pace eases near-term concerns about supply constraints but also signals potential pressure on prices if favourable conditions continue.
Going forward, traders are expected to monitor currency trends, energy markets, and crop progress closely. While the current uptick reflects macroeconomic influences, the cotton market is likely to remain range-bound in the short term, with external factors playing a decisive role in shaping its direction.
