ICE cotton futures declined on Wednesday after reaching a two-week high earlier in the day. The market faced pressure from a strengthening U.S. dollar and broader weakness in agricultural commodities, tempering early-session optimism. Despite a favorable long-term outlook, short-term challenges weighed on U.S. cotton prices.
The July 2025 ICE cotton futures contract settled at 67.38 cents per pound (approximately 0.453 kg), down 0.45 cent from the previous day, though it had earlier hit its highest level since April 25. The December 2025 contract closed at 69.25 cents, marking a decline of 0.27 cent. Other contracts ended 22 to 32 points lower. While prices softened, analysts note that a strong May settlement has set a positive upside target for July futures moving forward.
Trading volumes were notably higher on May 7, with 48,643 contracts traded, up from 34,224 the previous day. ICE reported that as of May 6, 2025, deliverable No. 2 cotton stocks remained unchanged at 14,049 bales.
Market watchers pointed to initial optimism around improved trade conditions driving early gains in cotton prices. However, ICE cotton futures decline during the session due to selling pressure. Analysts remain optimistic about a recovery later in the year, supported by factors such as reduced cotton plantings, an expected 10% depreciation in the U.S. dollar, and stronger export momentum.
Elsewhere in the financial markets, U.S. stock indices closed higher, lifted by strong gains in semiconductor stocks on news that AI chip trade regulations might be eased. In the agricultural sector, Chicago Board of Trade (CBOT) soybean futures fell for the third straight session amid concerns over global demand and mounting competition.
On the global stage, Brazil’s Secex reported April 2025 cotton exports at 239,145.21 tons, averaging 11,957.26 tons per day—a 9% increase compared to April 2024’s daily average of 10,973.14 tons. However, total exports for the month were slightly lower than the 241,409.03 tons recorded in April 2024.
Though ICE cotton futures decline reflects short-term market challenges, the longer-term outlook remains moderately positive, underpinned by supportive fundamental factors.
Currently, ICE cotton for July 2025 is trading at 67.51 cents per pound (up 0.13 cent), while cash cotton is at 65.63 cents (down 0.45 cent). Other contracts include the October 2025 contract at 69.40 cents (down 0.26 cent), December 2025 at 69.28 cents (up 0.03 cent), March 2026 at 70.48 cents (up 0.03 cent), and May 2026 at 71.49 cents (up 0.13 cent). Some contracts remained unchanged, with no trading recorded today.
