Cotton Recovers

After its late-session spill of Thursday, overnight the cotton market is trying to regain its poise. The market may be influenced by the sharply higher metals as well as anticipating the next few events and reports to be released between Friday and Monday.

Friday, the U.S. Supreme Court is expected to rule on the legality of the Trump administration’s sweeping global tariffs. The challenge to Trump’s tariffs is among the most closely watched of the cases awaiting decisions by the court. Its decision could impact the global economy and as well as being a major test of presidential powers.

The Labor Department will release its monthly jobs report Friday morning. The U.S. labor market likely showed modest improvement in December, providing some encouragement for the year ahead but nothing to get too excited about. Nonfarm payroll estimates call for an increase of 73,000 jobs, with the unemployment rate edging lower to 4.5%. Most economists see a labor market far from stellar but at least stable.

Also Friday at 3:30 p.m. EST, the CFTC will issue its scheduled (current) Commitments of Traders information. At last count, the managed-money funds were net-short some 49,000 bales.

Monday, USDA will issue its monthly supply-demand update. The average trade expectation for 2025 cotton production is at 14.20 million bales, virtually unchanged from the December number. Exports are expected at 12.04 million bales, and ending stocks are expected at 4.56 million, slightly higher than the previous number. World production is looking to be 119.46 million bales, slightly off, with global ending stocks at 75.62 million bales, fractionally lower.

Chart support for March cotton stands at 64.25 cents and 63.60 cents, with resistance hovering about 65.00 cents and 65.75 cents. Friday morning’s estimated opening volume is 8,305 contracts.

Keith Brown can be reached at commodityconsults@gmail.com or by calling (229) 890-7780.