Cotton Takes a Breather

After running up the “Bear’s Back” on Thursday, the cotton market is taking a Friday rest. The market had been encased in a sideways pattern for nearly two years and has recently emerged to the upside. That event has caused the heavily net-short speculative funds to begin covering their negative positions and thus this week’s price improvement. Traders are now on edge for this weekend in the Middle East theater, as well as Friday’s CFTC updates and next week’s acres intentions.

Today at 3:30 p.m. EDT, the CFTC will issue its Commitments of Traders report. At last count, CFTC reported managed-money funds were net-short some 40,000 positions, about one-half their record peak of 81,000-plus contracts.

The White House announced Thursday the Trump/Xi trade trip is now set for May 14-15. In addition, President Xi will visit Washington at a later day. Lastly, Xi expressed understanding that Trump had to reschedule the original meeting. 

Early expectations regarding USDA’s 2026 Prospective Plantings report next Tuesday are fairly tight-knit. The industry average estimate is 9.22 million acres. Previous guesses were the USDA Ag Forum’s 9.40 million and the NCC’s 8.99 million acres. The data will be out, along with Quarterly Grain Stocks, at noon EDT Tuesday.  

The National Climate Prediction Center has published some general thoughts on 2026 weather conditions. For the spring, the current drought is expected to expand in the U.S. West and in parts of the U.S. Plains. There will likely be a transition for La Nina to an ENSO-neutral in April-May (55% chance). During June through August, an El Nino event is forecasted (62%), and could persist to the end of this year. That event might bring wetter conditions across the U.S. Cotton Belt, but hot and dry conditions across swaths of the U.S. Midwest. Currently, the Center shows 91% of the U.S. Cotton Belt suffering drought conditions, up from last week’s reading of 90%.

Chart support for July cotton stands at 70.25 cents and 69.80 cents, with resistance around 72.00 cents and 72.50 cents. Friday morning’s estimated volume is 19,275 contracts.

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