US Cotton Market Kicks Off Year-End with Solid Upside Momentum

The US cotton market is closing out 2025 on an optimistic note, with front-month contracts posting gains of 17 to 20 points as trading activity picked up heading into the final sessions of the year. This rally reflects broader strength in the commodity space, though Tuesday’s session saw some profit-taking with futures settling just 5 points shy of flat.

Related Markets Painting Mixed Picture

While cotton enjoyed upward momentum, the broader commodity environment showed divergence. Crude oil futures retreated 13 cents to settle at $57.95 per barrel, suggesting some concern about energy demand. Meanwhile, the US dollar index strengthened, climbing $0.188 to $97.920, which typically creates headwinds for dollar-denominated commodities like cotton.

Physical Market Activity Remains Resilient

The Seam’s online auction on December 29 recorded sales of 23,018 bales at an average price of 59.79 cents per pound, indicating steady demand at current price levels. The Cotlook A Index extended its gains, jumping 50 points to 74.50 cents on Monday, underscoring the bullish sentiment rippling through the sector.

Supply Dynamics Unchanged

ICE certified cotton stocks held steady on December 29, maintaining a level of 11,600 bales. The Adjusted World Price for the US cotton market was updated to 50.02 cents per pound on Monday morning (delayed due to holiday scheduling), marking a modest 3-point increase from the previous week—a modest but welcome climb.

Contract Snapshot

• Mar 26 Cotton: Closed at 64.32 (down 3 points), currently up 17 points
• May 26 Cotton: Closed at 65.64 (up 1 point), currently up 19 points
• Jul 26 Cotton: Closed at 66.85 (up 1 point), currently up 20 points

The back months showing the largest gains reflects a constructive longer-term outlook, with investors positioning for continued strength in the US cotton market as 2025 advances.