22 Apr '25
(Fibre2Fashion News Desk (KUL): ICE cotton futures declined on Monday after reaching a recent high. Falling crude oil prices and weakness in financial markets dragged down US cotton prices.
Analysts said cotton was under pressure from external factors, including a sharp fall in stock markets triggered by a verbal spat between US President Donald Trump and Federal Reserve (Fed) chairman Jerome Powell.
Insights
ICE cotton futures fell on Monday as falling crude oil prices and sharp declines in US stock markets weighed on sentiment.
Despite a weaker dollar and strong export sales last week, cotton prices dropped, with the July 2025 contract settling at 66.82 cents per pound.
Analysts cited external market pressure and investor caution ahead of the May contract's First Notice Day as contributing factors.
The ICE cotton July 2025 contract settled at 66.82 cents per pound (0.453 kg), down 0.31 cent from the previous day. The contract reached a session high of 67.40 cents, the highest level since April 11. The December contract settled at 68.30 cents, down 0.14 cent on the day. Other contracts also posted losses ranging from 11 to 55 points.
A weaker dollar and last week’s strong export sales failed to contain cotton’s decline. While a weaker dollar typically makes cotton more affordable for overseas buyers, oil prices fell by more than 2 per cent due to signs of progress in US-Iran talks and concerns about reduced fuel demand stemming from economic headwinds and tariffs.
Lower oil prices make polyester—a man-made alternative to cotton—cheaper to produce.
Monday’s trading volume stood at 36,289 contracts, compared to 33,530 contracts cleared on Thursday. US stock markets dropped sharply after President Trump intensified his criticism of Powell, raising concerns over the Fed’s independence.
Trump once again urged the Fed to cut interest rates. Some selling pressure also stemmed from rollover activity ahead of the May contract’s First Notice Day on Thursday.
After the market closed, the USDA reported that US cotton planting progress had reached 11 per cent as of April 20, 2025—up from 5 per cent the previous week and in line with both last year’s level and the five-year average.
As of the latest trade, ICE cotton for May 2025 was at 65.48 cents per pound (down 0.29 cent). Cash cotton was quoted at 65.07 cents (down 0.31 cent). The July 2025 contract stood at 66.51 cents (down 0.31 cent), the October 2025 contract at 68.71 cents (down 0.09 cent).
The December 2025 contract at 67.97 cents (down 0.33 cent), and the March 2026 contract at 69.09 cents per pound (down 0.34 cent). A few contracts remained at previous closing levels, with no trading noted today. (Source: Fibre2Fashion.com)