– Reporting Period 15 – 28 July 2026 –
During the current reporting period, ICE Cotton No. 2 futures traded primarily sideways. After an initial dip, prices returned almost to the level equaling the start of the reporting period, though did not quite reach it.
Demand fell short of the average levels seen in recent years and was concentrated primarily in the Asian region. Despite higher demand, China was less active in the U.S. market, instead sourcing its supply from other countries. Vietnam was the largest buyer of U.S. cotton. However, spinning mills remained rather cautious in order to be able to react more securely to potential slumps in the textile market amid the current uncertainties.
Factors with a positive impact on prices included weather and yield risks in the southwestern United States, an increasingly tight cotton supply-demand balance for 2026/27, and relatively high U.S. export shipments.
On the other hand, the price trend was weighed down by continued subdued demand in the physical U.S. market, declining crude oil prices toward the end of the period, and the prospect that weather-related risk premiums could partially disappear as crop prospects improve.
The market is at a crossroads: Will there be a sustained rise driven by actual yield losses or stronger import demand? Or will better weather conditions in Texas, combined with persistently weak demand, cause prices to fall back toward the mid-70-cent range?