Cotton futures on the Intercontinental Exchange surged to a 22-month high, supported by a weaker US dollar, firm crude oil prices, and persistent drought concerns in key growing regions of the United States.
The July 2026 contract climbed to its highest level since July 2024, settling at 77.42 cents per pound after touching an intraday high of 77.75 cents. The May 2026 contract also gained, closing at 75.11 cents per pound, reflecting continued bullish momentum across the market.
Strong trading activity, with volumes reaching nearly 100,000 contracts, highlighted sustained investor interest. Market sentiment was further supported by rising synthetic fibre costs, driven by elevated crude oil prices amid ongoing geopolitical tensions, particularly around the Strait of Hormuz.
A softer US dollar improved the competitiveness of American cotton in global markets, boosting export demand. At the same time, prolonged dry weather in major US cotton-producing regions raised concerns over crop yields and supply availability.
Deliverable stocks remained unchanged at 159,512 bales, indicating relatively tight supply conditions despite rising prices.
Analysts note that the cotton market is currently being driven by a combination of macroeconomic factors and supply-side risks, with firm crude oil prices, weather uncertainty, and currency movements reinforcing the upward trend.
With broader financial markets also showing strength, cotton futures are expected to remain supported in the near term, although weather developments and geopolitical shifts will continue to influence price direction.
