Cotton Steadies as we Move Into Weekend

The cotton market is trading a steady-as-she-goes path into the weekend. Amazingly, March cotton is down one measly tick from last Friday’s settlement. The market remains in bearish depression as supply is up and demand for that supply is nominal. Also adding to cotton’s malaise are the shutdown-delayed, lagging reports.

The CFTC will issue another catch-up Commitments of Traders report Friday at 3:30 p.m. EST. That release will cover the period relating to Dec. 9. Currently, the managed-money funds stand at 59,787 contracts net-short versus their record high count of 81,000-plus contracts.

In a quick review, we note the most recent export data showed net-sales nearly 40,000 bales below the previous week. With that, U.S. cumulative net-sales of cotton are the lowest in over a decade. In percentage terms, U.S. sales are only 49% of USDA’s seasonal forecast, which is also well under the five-year average pace of 65% for this time of the year.

Crude oil is little changed Friday morning and actually is poised for a second straight weekly decline. Some analysts continue to expect a supply glut in 2026. Moreover, if a Russia-Ukraine peace deal does occur, then likely more supply will hit world trade. On ⁠a weekly basis, the Brent and WTI benchmarks were down 2.1% and 2.3%, respectively.

Daily chart support for March cotton stands at 63.25 cents and 62.75 cents, with resistance hovering about 64.00 cents and 64.50 cents. Friday morning’s estimated opening volume is 3,576 contracts.

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