ICE cotton futures fell on Tuesday as profit booking in soybeans and the relief from Argentina’s drought dampened market sentiment.
The March 2025 cotton contract dropped to 68.51 cents per pound, down 0.17 cents, following Monday’s gains.
While rising crude oil prices boosted polyester costs, making cotton more appealing, rains forecasted for Argentina next week helped alleviate concerns about potential cotton production issues. The increasing crude oil prices were linked to supply constraints from Russia and Iran, along with expectations of rising demand from China. These factors raised the cost of producing polyester, a man-made alternative to cotton, thereby making cotton futures more attractive.
Despite the positive impact from higher oil prices, the market saw a decline in ICE cotton, as profit-taking in soybeans and speculation around the improving drought conditions in Argentina outweighed the bullish oil influence. Trading volume rose to 34,165 contracts, slightly up from the previous day’s 33,661 contracts.
Market analysts suggest that the cotton market is unlikely to see rapid growth but will likely rise slowly due to improving demand. Traders in the market have been buying back short futures positions.
As of January 6, the ICE deliverable No.
2 cotton futures contract stocks remained unchanged at 20,113 bales.
In related markets, soybean futures fell as traders locked in profits, with expectations that Argentina’s drought-stricken crops would benefit from upcoming rains. Corn futures saw slight gains as traders adjusted positions ahead of the USDA supply and demand report.
As of the latest data, March 2025 ICE cotton futures are trading at 68.39 cents per pound (down 0.12 cents), while cash cotton is at 66.01 cents (down 0.17 cents). Other contracts, including May 2024, July 2025, and December 2025, saw minor fluctuations.
