U.S. cotton futures are currently trading around 74 cents per pound, marking a close proximity to their highest levels since early June, driven by ongoing concerns regarding tightening supply. Recent data from the USDA's weekly crop rort indicates a decline in U.S. cotton quality, now at 37%, down from 39% the previous week.
In its latest Stember WASDE rort, the USDA has revised down production estimates for the U.S. to 14.5 million bales, while global output estimates have been reduced to 116.4 million bales. On the demand front, the USDA's weekly export sales data revealed net sales of upland cotton totaling 106,800 running bales for the 2024/25 marketing year, a decline of 8% from the previous week and 23% from the average of the prior four weeks.
Since the start of 2024, cotton prices have decreased by 8.60 USD/Lbs, or 10.62%, according to trading on a contract for difference (CFD) that tracks the benchmark market for this commodity. Analysts predict that by the end of this quarter, cotton prices may settle at approximately 67.94 USD/Lbs. Looking ahead, projections estimate a further decline to around 62.99 within the next year.