Cotton Futures at Near 1-Year High

Cotton futures extended their upward momentum to cross 69 cents per pound, the highest level since April 2025, helped by a subdued US dollar, rising oil prices and speculators covering short positions. Meanwhile, traders weighed the outlook for demand and supply. According to the latest USDA's weekly export sales report, net sales of upland cotton for the current marketing year totalled 253,200 running bales in the week ended March 5, up 68% from the prior week. News of China’s willingness to expand purchases of US agricultural products also boosted market prospects. On the supply side, reports indicated weather conditions in the US cotton belt look challenging in the near term. Currently, 88% of the region is experiencing drought, with record-high temperatures recorded in March and very low precipitation. On the other hand, StoneX has raised its estimate for Brazil's total cotton supply in 2026 to 3.74 million tons, primarily reflecting the good development of crops in Bahia.

Cotton increased to 66.57 USd/Lbs, the highest since August 2025. Over the past 4 weeks, Cotton gained 3.96%, and in the last 12 months, it decreased 1.15%.

Cotton futures traded around 65.2 cents per pound, holding close to recent one-week highs, supported by firmer crude oil prices amid the Middle East crisis. Meanwhile, market participants assessed the outlook for supply and demand. The US Department of Agriculture, in its March 2026 WASDE report, projected higher global cotton production and ending stocks for the 2025–26 season while slightly lowering consumption. The production forecast was raised by over 1.1 million bales to 120.99 million bales, up from the USDA’s February 2026 estimate of 119.86 million bales, reflecting larger crops in Brazil and China. The world consumption forecast is down 140,000 bales, with mill use projected lower in several countries, partially offset by higher consumption in China.