Cotton futures are mixed Friday morning, with most contracts showing weakness, though the July contract is slightly up. Thursday saw contracts decline between 34 and 52 points, influenced by lower crude oil prices and a weaker US dollar. The Cotlook A Index decreased to 77.95, and ICE cotton stocks fell by 4,654 bales due to decertification, resulting in certified stocks of 41,863 bales.
Cotton markets are displaying mixed signals with a generally bearish undertone, as reflected by the "moderately negative" sentiment score (-0.5). Specifically, while July futures (which closed Thursday at 64.84, down 49 points) showed a minor gain of 3 points in Friday morning trading, deferred contracts extended recent weakness; October futures (closed 67.24, down 52 points) were down a further 38 points, and December futures (closed 67.76, down 34 points) were down 10 points. This price pressure occurred despite a weaker U.S. dollar index, which fell $0.505 to $99.260, a typically bullish factor for U.S. commodities. Conversely, a $0.97 drop in crude oil prices may be contributing to the bearish sentiment. Key benchmarks reflect this softness: the Cotlook A Index decreased 30 points to 77.95 cents/lb as of May 28th, and the USDA’s Adjusted World Price was last marked 38 points lower at 53.52 cents/lb. A notable counterpoint is the reduction in ICE certified cotton stocks, which fell by 4,654 bales to 41,863 bales on May 28th due to decertification, potentially indicating tighter deliverable supplies. A recent cash sale on The Seam on Wednesday saw 440 bales transacted at an average price of 66.35 cents/lb.
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moderately negative
Sentiment Score
-0.50
Ticker Sentiment
