– Reporting Period 12 – 25 August 2026 –
During the reporting period, the international cotton market showed a significantly firmer trend than before. ICE Cotton No. 2 futures for December 2026 contracts rose from 84.38 U.S. ct/lb on August 12 to 88.34 U.S. ct/lb on August 25, an increase of about 4.7 percent.
A key factor behind the rise can be seen in the increasingly tight global cotton balance forecast in the WASDE report. According to the latest projections, the gap between rising cotton consumption and production is widening. Moreover, the current reporting period was characterized by the underachieving U.S. crop, the U.S. dollar weakening significantly at times, and speculative market participants expanding their long positions. In contrast, real demand from the textile industry varied by region and proved less dynamic than the futures movements would have suggested.
During the reporting period, the market shifted from a perception of a predominantly abundant supply to an increasingly tight global 2026/27 balance. The pace of the increase also highlighted that, in addition to fundamentals, weather premiums, currency effects, and speculative buying now play a significant role in price formation.