– Reporting Period 11 – 24 October 2023 –
The ICE Cotton No. 2 futures have lost ground in recent times. During the past two weeks, the futures broke away from their price range between 85 and 90 ct/lb, in which they had stayed for quite a long time, and decreased to just over 82 ct/lb. The price loss resulted from weak demand for U.S. cotton. In particular, the key purchaser China has suffered from a weakening economy. The Chinese cotton demand was therefore reduced. However, some existing demand shifted to other producing countries, especially Brazil, which is on its way to record cotton shipments.
The production volume of U.S. cotton as well as ending stocks were reduced in the current WASDE report, while Brazil’s ending stocks were lifted. Such a raised competitive pressure will also have impact on the futures.
Hardly anything happened on the European market during the reporting period. Only a few enquiries led to closed contracts. The ongoing crises have continuously been putting weigh on the whole textile chain.